Green financing for environmental protection and sustainable economic growth – a comparison of Indonesia and Serbia

Abstract

The term “green financing” denotes a new area of finance that has application in the process of integration of environmental protection and economic profit. This term encompasses wide ranges of environmentally friendly technologies, projects and industries, as well as verification of the viability of concepts for balancing ecological depreciation in the process of assimilation of carbon in the atmosphere. Essentially, green financing is part of the green carbon issue because it connects the financial industry, environmental improvement and economic growth, which is essential for long-term sustainable development. As this is an innovative concept, the paper pays special attention to the development of market mechanisms and policy formulation for green financing. By revealing the internal contradictions between green financing and environmental protection in achieving ecological balance and sustainable economic growth, the paper proposes some options for the mobilization of private capital for green investments that can be applied in Serbia. The paper also compares two countries, Indonesia and Serbia, with regard to the green financing sector. The authors highlight differences between the economies of Indonesia, as a representative of ASEAN, and Serbia, demonstrating that Indonesia is far ahead of Serbia in terms of the concepts of green financing and sustainable development.