EXIM Thailand Responds to Ministry of Finance Policy with Green Ecosystem and Low-Carbon Society Pinned to Top and Underlines Success of Thailand's First Green Certificate

Dr. Paopoom Rojanasakul, Deputy Minister of Finance, congratulated Export-Import Bank of Thailand (EXIM Thailand) on its successful implementation of Thailand's first 5-billion-baht green certificate of deposit project available for sale within 2024. This initiative has been in response to the government policy to drive low-carbon ecosystem and sustainable development from community to national and global levels. The project has represented the pioneering development of green certificate of deposit under sustainable finance framework with international standard certification by DNV (Thailand) Co., Ltd. aiming to raise funds to support ecofriendly trade and investment of Thai entrepreneurs both domestic and overseas.

Deputy Minister of Finance said that in the face of the extreme environmental events amid intensifying climate change, governments of several countries have successively taken stringent environmental trade measures, totaling approximately 18,000 measures so far or an average increase of 16% per year over 2013-2022, particularly in Thailand's key export markets such as the US, the European Union, Japan, China and India, which combinedly represented 51% of the country's total export value in 2023. However, Thai export of environmentally friendly goods has remained small, representing only 7.6% of total export value in 2021, compared to the high proportions in such countries as Germany 15.4%, Japan 15%, China 10.4%, and South Korea 10.2%. It is thus time for Thai exporters to make a quick move to adapt to and deal with such changes and challenges so that they would be able to well compete in the global trade markets. Meanwhile, financial institutions have to expand their role in enabling entrepreneurs' access to financial sources to facilitate their adjustments amid the growing demand around the world for financial facilities in relation to climate change solutions or climate finance. According to the data, global climate finance has been in an average amount of 1.3 trillion US dollars per year, which is around 6 times lower than the estimated global climate finance needs of 8.6 trillion US dollars per year. Such climate finance needs have been projected based on investments in multiple areas to ensure global temperatures do not rise above 1.5 degrees Celsius. This can be interpreted that the current investments to cope with climate change have not yet been sufficient to stop the temperature from rising to above 1.5 degrees Celsius as targeted.

Dr. Paopoom further said that the green certificate of deposit project of EXIM Thailand as a state-owned financial institution under the Ministry of Finance's supervision is an integrated collaboration between the public and private sectors in developing green financial tools to jointly transition Thailand to a low-carbon economy and society and achieve the country's carbon neutrality goal by 2050 and net zero emissions goal by 2065. Thailand will from now on take a more concrete action to build the green export supply chain from upstream to downstream, i.e., from securing funding and raw materials to manufacturing process and delivery of goods, based on environmentally harmless logistics, higher consumption of clean energy, and greater green and sustainable ecosystem.

Dr. Rak Vorrakitpokatorn, President of EXIM Thailand, said that with EXIM Thailand's commitment to its greenovation strategy under its role as a Green Development Bank to drive sustainable development, the Bank has planned to sell green certificate of deposit under the sustainable finance framework certified by DNV (Thailand) Co., Ltd. in a total amount of 5 billion baht by 2024, which is the first of its kind in Thailand. The first tranche was sold in April 2024 in the amount of 1,300 million baht, well responded by alliance agencies, namely the Industrial Estate Authority of Thailand (IEAT), Provincial Waterworks Authority (PWA), Port Authority of Thailand (PAT), and Thai Credit Guarantee Corporation (TCG) to propel multi-faceted national development from infrastructures and public utilities to logistics and, importantly, climate finance which would facilitate Thai entrepreneurs' start-up and expansion of small businesses from community level in linkage with the export supply chain toward the world markets. The proceeds from the issuance and sales of certificate of deposit will be used by EXIM Thailand to promote and support business sectors and entrepreneurs operating green businesses, including those wishing to rationalize their production processes, through such facility schemes as EXIM Green Start, Solar D-Carbon Financing and Green Guarantee, all in response to demand for business operation with environmental friendliness and encompassing the entire ecosystem as much as possible.