Green financing is growing in Central Asia

Kazakhstan has become Central Asia's leading market for green and sustainable bonds. However, there is also great potential in other countries in the region, said Manas Gizhduaniyev, Managing Director of the AIFC Green Finance Center (GFC), on the sidelines of the Regional Ecology Summit 2026 in Astana. "Our main task is to promote green and sustainable financial services in Kazakhstan," said Gizhduaniyev. The center is a subsidiary of the Astana International Financial Centre, but also works with other Central Asian countries. Over the past five years, the GFC has played an important role in developing the market. "We were instrumental in developing the green taxonomy for Kazakhstan and supported the issuance of the first green bond, social bond and sustainable bond in Kazakhstan, Kyrgyzstan, Uzbekistan and Azerbaijan," he said. Kazakhstan dominates the regional market The center acts primarily as a verification body for green bonds. This work follows international standards, such as the Climate Bonds Initiative and the International Capital Market Association. According to Gizhduaniyev, the GFC is the only inspection body in Central Asia with dual accreditation. The market started out small. The first green bond in Kazakhstan and Central Asia was issued by the state-owned Damu Fund in 2020. "The amount was very small; it was a pilot project," said Gizhduaniyev. At that time, many financial institutions still had little experience with such instruments. Since then, the volume has increased significantly. National companies, subsidiaries of Samruk-Kazyna and Baiterek Holding have now issued green, social and sustainable bonds. According to Gizhduaniyev, the outstanding sustainable bonds in Central Asia amount to around 3.5 billion US dollars. Kazakhstan accounts for around 2.9 billion US dollars of this. This means that the country dominates the regional market. Kazakhstan and Uzbekistan are among the most important issuers, but differ in their market structure. "In Kazakhstan, thematic bonds are mainly used by companies, banks and state-owned companies," said Gizhduaniyev. "In Uzbekistan, on the other hand, the Ministry of Finance has issued several green government bonds and ESG bonds." There, the market is more strongly supported by the state, while in Kazakhstan it is mainly characterized by the private sector and state-affiliated companies. Stock exchanges create additional incentives The local stock exchanges also support the development. In Kazakhstan, sustainable bonds are mainly placed on the Astana International Exchange and the KASE. Both exchanges have waived the listing fees for green, social and sustainable bonds. This combination of standards, verification and financial incentives facilitates issuance. "We now have a common language for what is considered environmentally friendly, a global verifier and incentives from the exchanges," said Gizhduaniyev. This could make issuing such bonds cheaper than traditional bonds. Interest in the region is likely to continue to grow. According to the GFC, it is working together with Kyrgyzstan, Uzbekistan, Azerbaijan and Tajikistan. Gizhduaniyev sees great potential for financial companies in particular. Many banks are planning green bonds and are currently developing corresponding frameworks. However, issue volumes have recently declined. After a record year in 2024, the volume of green bonds in Central Asia fell by around 25 percent in 2025. Gizhduaniyev attributes this to changes in subsidy programs. In 2024, Kazakhstan introduced a subsidy program that enabled small and medium-sized enterprises to receive state support for coupon payments. This made emissions particularly attractive. This program has since been adjusted. Nevertheless, the market is still in its infancy. "The market is small at the moment, but we are working on its development. It is only five years old," said Gizhduaniyev. The funds from green and sustainable bonds flow primarily into renewable energies, climate adaptation, energy efficiency and waste management. Waste management in particular is becoming increasingly important. "This is a major problem, not just in Kazakhstan, but throughout Central Asia," he said. The GFC is currently working on five projects for which green bonds are being prepared. Contracts have already been signed with the companies involved. The next step is to obtain second opinions and reviews for the planned issues. The post Green financing is growing in Central Asia appeared first on ostwirtschaft.de.