Bank of Albania in collaboration with the Centre for Economic Transition Expertise at LSE organize the workshop ''Navigating Interconnected Risks: Implications of Environmental[...]

On July 11, 2024, the Bank of Albania, in collaboration with the Centre for Economic Transition Expertise (CETEx) at the London School of Economics (LSE), organized a workshop in Tirana titled "Navigating Interconnected Risks: Implications of Environmental Degradation and Climate Change."

The workshop brought together representatives from key public and private institutions in Albania, prominent national and international experts, policymakers, and economists, with the main goal of engaging various actors in a dialogue about the challenges posed by climate change and its implications on the economy and finance.

Structured into three sessions, the workshop began with opening remarks from the Director of the Research Department of the Bank of Albania, Mr. Altin Tanku, and the Director of Monetary and Financial Markets at CETEx, Mr. Simon Dikau.

The keynote speech was delivered by the Second Deputy Governor of the Bank of Albania, Ms. Natasha Ahmetaj, who provided an overview of the Bank of Albania's Green Strategy, developed in collaboration with the World Bank, in line with global objectives for a sustainable economy and financial systems. Deputy Governor Ahmetaj emphasized the importance of the financial sector's role in taking a bold approach towards these objectives, supporting technological progress and innovation. This requires, first and foremost, the inclusion of climate change risks in financial sector exposure analyses, considering financial stability as a prerequisite for a green transition.

The first session focused on presenting the Annual Progress Report of the Bank of Albania's Green Strategy. This session included presentations on the achievements and challenges of the past year in fulfilling the objectives outlined in the Strategy, focusing on the second exposure assessment analysis of the Albanian banking sector to climate risks. This analysis was followed by the presentation of the first draft of the guideline for managing climate and environmental risks in the banking sector.

During the other two sessions, issues related to meeting the requirements of the 2030 Agenda and European integration were addressed, such as the drafting of the Taxonomy and modeling the measurement of the impact on the financial system from the loss of nature and biodiversity, including technical discussions on how FinTech can be used for ESG integration. This session also presented case studies on the specific impact of climate change on hydropower production.

The workshop concluded by emphasizing the necessity of active involvement and coordination of all national and international actors in addressing climate and environmental risks to ensure a sustainable future. Additionally, the importance of exchanging best practices and translating knowledge into practical applications was highlighted, aiming to direct energies towards the most creative and efficient solutions.