Opportunities for Using Green Bonds to Finance Environmental Projects in Developing Countries: Experience of the Republic of Kazakhstan
Abstract
Sustainable business development based on environmental, social, and governance principles is one of the leading trends in the financial and global community. The introduction of environmental, social, and governance principles is intended to facilitate the implementation of countries’ pledges under the Paris Agreement on Climate and the achievement of the UN Sustainable Development Goals. In 2015, the Republic of Kazakhstan committed to following sustainable development goals, which made the principles of a sustainable and green economy a national priority of the 2050 Strategy. The study aims to identify the opportunities to use green bonds in Kazakhstan so as to increase the effectiveness of territorial management and the development of environmental projects. Proceeding from an expert survey, the study establishes arguments in favor of developing green bonds for the implementation of environmental projects in Kazakhstan, outlines the main hindrances to the advance of green bonds in the country, and lists the conditions required for further proliferation of the use of green bonds. The authors argue that the active use of green bonds can be facilitated by knowledge exchange, capacity building, and state support (especially in analyzing the economy of Kazakhstan) for the development of the market for green bonds, as well as state encouragement of private investors to green investment.
References
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[28] Yerkinbayeva, L., et al. 2021. Legal regulation of Kazakhstan's transition to the green economy. Journal of Environmental Management and Tourism, 12(5): 1335-1342.
[29] Yerkinbayeva, L., et al. 2022. Digitalization of environmental information in the Republic of Kazakhstan: Issues of legal regulation. Journal of Environmental Management and Tourism, 13(1): 115-27.
[30] Zerbib, O.D. 2019. The efect of pro-environmental preferences on bond prices: Evidence from green bonds. The Journal of Banking and Finance, 98: 39-60.
[31] Zhao, C.P., Gukasyan, G., Bezpalov, V. and Prasolov, V. 2020. Development of modern standards for energy efficiency of industrial enterprises within the European Union policy. International Journal of Energy Economics and Policy, 10(6): 451-9.
[32] Decree of the Government of the Republic of Kazakhstan of October 13, 2021 No. 736 “On amendments and additions to the Resolution of the Government of the Republic of Kazakhstan of December 24, 2019 No. 968 ‘On the approval of the State program for the support and development of business ‘Business Road Map-2025’ and of December 31, 2019 No. 1060 ‘On some measures of state support for private entrepreneurship’”. Available at: https://primeminister.kz/ru/decisions/20102021-736
[33] The Code of the Republic of Kazakhstan of January 2, 2021 No. 400-VI "Environmental Code of the Republic of Kazakhstan". Available at: https://adilet.zan.kz/rus/docs/K2100000400
[2] Bachelet, M.J., Becchetti, L. and Manfredonia, S. 2019. The green bonds premium buzzle: The role of issuer characteristics and third-party verification. Sustainability, 11(4): 1098. DOI:https://doi.org/10.3390/su11041098
[3] Banga, J. 2019. The green bond market: A potential source of climate finance for developing countries. Journal of Sustainable Finance and Investment, 9(1): 17-32. DOI:https://doi.org/10.1080/20430795.2018.1498617
[4] Bezpalov, V.V., et al. 2020. PR support in strategic investor relations at retail companies. Journal of Advanced Pharmacy Education and Research, 10(2): 84-90
[5] Cheong, C., and Choi, J. 2020. Green bonds: A survey. Journal of Derivatives and Quantitative Studies, 28(4): 175-89. DOI: https://doi.org/10.1108/jdqs-09-2020-0024
[6] Chernysheva, A., Dobrova, K. Dobrova, E. and Kuznetsova, V. 2021. Transformation of economic interests in the context of the multipolar world order formation. Economic Annals-XXI, 192(7-8(2): 15-25. DOI:https://doi.org/10.21003/ea.V192-02
[7] Deschryver, P., and de Mariz, F. 2020. What future for the green bond market? How can policymakers, companies, and investors unlock the potential of the green bond market? Journal of Risk and Financial Management, 13(3): 61. DOI: https://doi.org/10.3390/jrfm13030061
[8] Dokholyan, S., et al. 2022. Influence of management automation on managerial decision-making in the agro-industrial complex. International Journal of Advanced Computer Science and Applications, 13(6): 597-603. DOI: http://dx.doi.org/10.14569/IJACSA.2022.0130672
[9] Dorfleitner, G., Utz, S. and Zhang, R. 2021. The pricing of green bonds: External reviews and the shades of green. Review of Managerial Science, 16: 797-834. DOI: https://doi.org/10.1007/s11846-021-00458-9
[10] Dudin, M.N., et al. 2016. Methodology of analysis and assessment of risks of the operation and development of industrial enterprises. Quality - Access to Success, 17(153): 53-9.
[11] Ehlers, T., and Packer, F. 2017. Green bond finance and certification. BIS Quarterly Review, September 2017: 89-104.
[12] European Commission, Directorate-General for Environment, Cochu, A., C. Glenting, D. Hogg, I. Georgiev, J. Skolina, F. Elsinger, M. Jespersen, R. Agster, S. Fawkes, and T. Chowdury. 2016. Study on the potential of green bond finance for resource-efficient investments. Luxembourg: Publications Office of the European Union. DOI: https://doi.org/10.2779/234777
[13] European Commission, Joint Research Centre, Fatica, S., and R. Panzica. 2020. Green bond as a tool against climate change? Luxembourg: Publications Office of the European Union, 26 p. DOI:https://doi.org/10.2760/24092
[14] Febi, W., Schäfer, D., Stephan, A. and Sun, C. 2018. The impact of liquidity risk on the yield spread of green bonds. Finance Research Letters, 27: 53-9. DOI: https://doi.org/10.1016/j.frl.2018.02.025
[15] Gianfrate, G., and Peri, M.2019. The green advantage: Exploring the convenience of issuing green bonds. Journal of Cleaner Production, 219: 127-35.
[16] Hachenberg, B., and Schiereck, D. 2018. Are green bonds priced diferently from conventional bonds? Journal of Asset Management, 19(6): 371-83. DOI: https://doi.org/10.1057/s41260-018-0088-5
[17] Jin, J., Han, L., Wu, L. and Zeng, H. 2020. The hedging effect of green bonds on carbon market risk. International Review of Financial Analysis, 71: 101509. DOI: https://doi.org/10.1016/j.irfa.2020.101509
[18] Kaldiyarov, D., et al. 2021. Sustainable development of rural areas. Assessment of the investment appeal of the region. Journal of Environmental Management and Tourism, 12(1): 56-63. DOI:https://doi.org/10.14505/jemt.v12.1(49).05
[19] Laurent, O., and Riyanti, R.S. 2021. Determinants of green bond premium in the ASEAN market amidst the COVID-19 pandemic. Jurnal Keuangan dan Perbankan, 25(4): 734-53.
[20] Lin, L., and Hong, Y. 2021. Developing a green bonds market: The case of China. European Business Organization Law Review. DOI: http://dx.doi.org/10.2139/ssrn.3880280
[21] Martirosyan, A.V., Ilyushin, Y.V. and Afanaseva, O.V. 2022. Development of a distributed mathematical model and control system for reducing pollution risk in mineral water aquifer systems. Water, 14(2): 151. DOI: https://doi.org/10.3390/w14020151
[22] Nanayakkara, M., and Colombage, S. 2019. Do investors in green bond market pay a premium? Global evidence. Applied Economics, 51(40): 4425-37.
[23] Reboredo, J.C. 2018. Green bond and financial markets: Co-movement, diversification and price spillover effects. Energy Economics, 74: 38-50. DOI: https://doi.org/10.1016/j.eneco.2018.05.030
[24] Serikbaeva, G.G., Bektanov, B. and Bekturganova, A. 2019. Sources of attracting investments in technological innovation projects to ensure the sustainable development of rural areas. Journal of Environmental Management and Tourism, 10(4): 935-41.
[25] Tolliver, C., Keeley, A.R. and Managi, S.2019. Green bonds for the Paris agreement and sustainable development goals. Environmental Research Letters, 14(6): 064009. DOI: https://doi.org/10.1088/1748-9326/ab1118
[26] Tsenina, E.V., et al. 2022. Cluster analysis of the expenditures for environmental and technological innovations in sustainable development policy formation. Journal of Environmental Management and Tourism, 13(1): 63-74.
[27] Wulandari, F., Schäfer, D. Stephan, A. and Suna, C. 2018. The impact of liquidity risk on the yield spread of green bonds. Finance Research Letters, 27: 53-9.
[28] Yerkinbayeva, L., et al. 2021. Legal regulation of Kazakhstan's transition to the green economy. Journal of Environmental Management and Tourism, 12(5): 1335-1342.
[29] Yerkinbayeva, L., et al. 2022. Digitalization of environmental information in the Republic of Kazakhstan: Issues of legal regulation. Journal of Environmental Management and Tourism, 13(1): 115-27.
[30] Zerbib, O.D. 2019. The efect of pro-environmental preferences on bond prices: Evidence from green bonds. The Journal of Banking and Finance, 98: 39-60.
[31] Zhao, C.P., Gukasyan, G., Bezpalov, V. and Prasolov, V. 2020. Development of modern standards for energy efficiency of industrial enterprises within the European Union policy. International Journal of Energy Economics and Policy, 10(6): 451-9.
[32] Decree of the Government of the Republic of Kazakhstan of October 13, 2021 No. 736 “On amendments and additions to the Resolution of the Government of the Republic of Kazakhstan of December 24, 2019 No. 968 ‘On the approval of the State program for the support and development of business ‘Business Road Map-2025’ and of December 31, 2019 No. 1060 ‘On some measures of state support for private entrepreneurship’”. Available at: https://primeminister.kz/ru/decisions/20102021-736
[33] The Code of the Republic of Kazakhstan of January 2, 2021 No. 400-VI "Environmental Code of the Republic of Kazakhstan". Available at: https://adilet.zan.kz/rus/docs/K2100000400
Published
2022-12-02
How to Cite
NURGALIYEVA, Aliya Miyazhdenovna et al.
Opportunities for Using Green Bonds to Finance Environmental Projects in Developing Countries: Experience of the Republic of Kazakhstan.
Journal of Environmental Management and Tourism, [S.l.], v. 13, n. 7, p. 1918 - 1926, dec. 2022.
ISSN 2068-7729.
Available at: <https://journals.aserspublishing.eu/jemt/article/view/7397>. Date accessed: 26 apr. 2024.
doi: https://doi.org/10.14505/jemt.v13.7(63).12.
Section
Article
Copyright© 2023 The Author(s). Published by ASERS Publishing 2023. This is an open access article distributed under the terms of CC-BY 4.0 license.