Abstract & Overview
The circulation of green financial instruments in both the United States and European Union countries, as well as in Georgia, is an important step towards achieving sustainable development goals (SDGs) and financing ecological projects. However, this process still faces several challenges: market development and liquidity, regulations and standards, lack of information and awareness, financial risks and stability, and the impact of climate change. In Georgia, the effectiveness of the circulation of green financial instruments is determined by both issuers and investors, borrowers, and insurers. It depends on who benefits in which direction, but so far there is no transparency of results. Measuring the effectiveness of their circulation and its transparency is important because it allows organizations and individuals to better manage resources and gain maximum benefit. During the research, the circulation of green bonds issued by various companies and the statistics of green loans issued by commercial banks were studied and evaluated. It was revealed that since 2019, the effectiveness of green financial relations has been increasing annually. It is especially noteworthy that green insurance has appeared on the market, which includes identifying, assessing, and covering climate change risks. It helps to finance sustainable projects and its main types are: Energy efficiency insurance: covering risks of energy efficiency projects such as the implementation of energy-saving technologies and the construction of energy-efficient buildings. Renewable energy insurance: covering risks of solar, wind, and hydropower projects. Waste management insurance: covering risks of waste recycling and waste management infrastructure development. Green financial relations in Georgia require a complex approach and multifaceted actions. This includes market development, improvement of regulations and standards, dissemination of information and raising awareness, development of financial incentives, and climate change adaptation strategies. Also, solving existing challenges in the following ways: Attracting more investors and diversifying financial instruments for the development of the green finance market. Also important is the support and partnership of international financial institutions. Developing clear and transparent regulations and standards that ensure investor confidence and market stability, despite the fact that the sustainable finance guide developed by the National Bank and ESG guidelines play an important role in this process. Dissemination of information and raising awareness about the benefits and importance of green financial instruments. This may include marketing campaigns, workshops, and training. Development of financial incentives and benefits that will help attract investors and stabilize the market. Also important is the support and partnership of international financial institutions. Developing and implementing climate change adaptation strategies that ensure the sustainability and long-term success of green projects.