Financial System Readiness to Achieve Carbon Neutrality

This chapter examines the state of green finance in Oman and evaluates its capabilities to achieve environmental targets set by the country. This study analyzes the status of developing innovative green finance products, such as green Sukuk (green bonds) and other banking products in the Sultanate. Green finance is important to facilitate and encourage various stakeholders of society to promote financing for a sustainable future. The chapter also gauges the green financing initiatives initiated by different financial institutes of the country to promote the use of renewable resources in the Sultanate. The study uses the Content analysis methodology to ascertain the country's progress toward green finance. Several aspects of the data are identified and analyzed for content analysis. This analysis concludes that green finance is still in the emerging stage in the country. For commercial projects, green finance products have shown little progress. In the recent past, different financial institutes started green finance products for financing domestic projects. However, the scale of this activity is also lower than required to achieve the country's environmental goals. The study concludes that the government is trying to enhance green finance activities at various levels. Still, compared to other countries of the region, there is much to be done to achieve climate goals. The study recommends policymakers develop a mechanism to overcome challenges in promoting green finance. Also, it needs to support issuers in issuing advanced financial products like Green Bonds and Sukuk. It can be done by raising awareness about green finance, providing preference treatment for green financial products, and developing a clear regulatory framework.