This document, National Sustainable Finance Roadmap of Mongolia, provides an overview of existing market principles, policies and regulations, estimated investment needs, incentive mechanisms, and barriers to scale up sustainable finance in Mongolia. It also proposes a strategic roadmap for Mongolia to overcome the identified barriers to move to a sustainable financial system. The activities in the roadmap are categorized into short-, medium-, and long-term approaches and are endorsed by the Sustainable Finance Advisory Committee consisting of the Ministry of Finance, the Ministry of Environment and Tourism, the Bank of Mongolia, the Financial Regulatory Commission, the Mongolian Stock Exchange, the Mongolian Bankers Association, and the Mongolian Sustainable Finance Association.
There is a growing awareness that the risks of inaction are considerable, but also that a new development model can unlock great opportunities for many countries including Mongolia. As a result, the Parliament of Mongolia has endorsed a clear sustainable development pathway to 2030. This vision is enshrined in several key documents and lays out ambitious goals related to economic growth, diversification, ecological balance and social stability. These sustainability aspirations have the potential to deliver strong social, environmental and economic outcomes that will also contribute to the delivery of the Sustainable Development Goals (SDGs). Several key challenges have been identified that will need to be addressed. Among these, sustainable finance has been highlighted as a core obstacle that needs to be overcome to fully unlock the potential of Mongolia.
Banks dominate the Mongolian financial sector, holding 88% of financial assets. They have been advancing the sustainability agenda domestically since 2013. While the momentum from commercial banks has been highly encouraging, there is a growing realization that the entire financial system will need to be harnessed to help the country pivot onto a new sustainable growth trajectory. This includes the capital markets, the non-bank sector, insurance and institutional investors. In order to help realize this ambition, Mongolia has developed a sustainable finance roadmap through an inclusive, multi-stakeholder process. The roadmap systematizes and clarifies existing developments while also drawing on relevant international experience from the growing number of countries who are scaling up sustainable finance worldwide.