21-05-2025
CBI unleashes green finance: Billions for eco-projects
Shafaq News/ The Central Bank of Iraq (CBI) began issuing specialized banking licenses to support climate action and environmental sustainability, Governor Ali Al-Alaq announced on Wednesday.
During the first Conference on Carbon Economics in Iraq, Al- Alaq said that Iraq's monetary policy promotes green finance by offering incentives for environmental projects and urging banks to manage climate risks. He added that the CBI is coordinating with international networks to align regulations and assess environmental impacts within the financial sector.
As part of these efforts, Al-Alaq highlighted a 1 trillion Iraqi dinar (about $766.9M) initiative launched by the CBI in coordination with the Cabinet's Higher Lending Committee to help transition from traditional energy sources to renewable ones and reduce carbon emissions. The initiative is already financing projects such as waste recycling, palm cultivation, the Abu Ghar fields in the Samawah desert, and the Green House Project.
The Central Bank of Iraq has partnered with the World Bank to develop a green finance model as part of its 2023–2029 sustainability roadmap, aiming to manage ESG risks and make Iraq's banking sector a leader in environmentally responsible practices.
Al-Alaq also announced that the CBI has allocated 500 million dinars (about $383.4K) per facility to help rehabilitate brick factories transitioning from heavy-polluting black oil to cleaner liquefied gas.
In addition, the Central Bank has contributed 1 billion dinars (about $766.9K) to Iraq's Environmental Protection and Improvement Fund to help combat air pollution, expand green spaces, and lower harmful emissions. It has also financed waste recycling projects under the CBI's Energy Initiative, which is currently being implemented to reduce soil pollution, particularly in landfill areas that pose long-term environmental risks to housing and agricultural development.
The bank is also supporting small-scale agricultural projects through its Prospects program, in partnership with the International Labour Organization, the Iraqi Guarantee Company, and private banks. Around 3 billion dinars have been allocated to displaced communities in Nineveh and Duhok for this purpose.
He also announced that the Central Bank had contributed nearly 350 billion dinars to Iraq's urban afforestation initiative. The initiative aims to create green belts around provincial capitals to serve as natural barriers against dust storms and pollutants while helping mitigate desertification.
