DR Green Taxonomy Implementation

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The project will achieve its objective by promoting the use of the GT through regulatory measures that enable its adoption, alongside with capacity-building with both financial and real sectors (including but not limited to energy and construction, the latter within the tourism industry as it is the main source of foreign direct investment in the DR). It will also expand the scope of the taxonomy to include or enhance the objectives and sectors, in line with the country’s needs and international best practices. Ultimately, these actions are intended to establish the conditions for the financial and real sectors to effectively access and channel green finance in alignment with the GT, supporting broader sustainable development objectives. Project implementation will include the following components: Component 1: Improvement of the regulatory framework and enabling environment to strengthen Taxonomy implementation Activities include: 1.1. Implementation of pilot exercises in two sectors, such as construction within the tourism industry and energy, due to their large contribution to environmental impact and their critical importance to mitigation efforts. In addition, these sectors host significant green projects in areas where the financial sector is actively engaged in green operations. These initiatives aim to gain deeper insights into the challenges faced by the real sector in adopting the Green Taxonomy while also supporting efforts to facilitate compliance. 1.2 Provision of advisory services to regulators (Superintendency of Banks and Superintendency of Capital Markets) to develop a regulatory and supervisory framework for implementing the Taxonomy. This includes development of guidelines and regulations for reporting on the eligibility and or alignment of the Green Taxonomy (i.e. circulars, non-financial risk regulation for the banking sector, etc. 1.3 Preparation of gap analysis of the environmental permits for sectoral projects (i.e. licenses/permits for construction projects) to comply with the Green Taxonomy. 1.4 Provision of recommendations to adapt or simplify environmental permits to comply with the Green Taxonomy. 1.5 Support the implementation of selective recommendations for improving environmental permits to comply with the Green Taxonomy. Component 2: Capacity building and knowledge generation for the real and the financial sector Activities include: 2.1 Capacity building workshops tailored by sector addressed in the Green Taxonomy (energy, construction, transport, industry, water resource management, ICT, waste management and emissions capture) for real sectors, 2.2 Capacity building workshops tailored for the financial sector 2.3 Development of prerecorded virtual tutorials about how to use the Green Taxonomy, 2.4 Development of sector-specific knowledge guides to implement the GT, frameworks for establishing environmental and social risk management systems (ESMS) in the financial sector, and practical guides for applying the Taxonomy in banking sector. These guides will assist business managers in identifying business opportunities aligned with the GT, fostering its integration into banking operations and decision making. 2.6. Development of a case study to promote a sustainable banking sector and accelerate the adoption of Green Taxonomy by business departments inside banking institutions. Component 3: Expansion of the Green Taxonomy. Activities include: 3.1 Update the Green Taxonomy to strengthen the adaptation objective and biodiversity activities, broaden, strengthening waste management activities, and including the Agriculture sector.