FG to Raise N25bn Green Bond to Fund Environmental Projects

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Mohammad Abubakar
Minister of Environment, Dr. Mohammad Abubakar

Goddy Egene

The Minister of Environment, Dr. Mohammad Abubakar, thursday said the federal government is ready to undertake a third tranche of the green bond programme of up to N25 billion to fund environmental projects.

The proceeds of green bonds are exclusively applied to finance or re-finance eligible green projects that align with the four core components of the Green Bond Principles (GBP) including : renewable energy, afforestation, and transportation.

The government had already raised N10.69 billion in 2017 and N15 billion in 2019 in two tranches.

Green Bonds are any type of bond instrument where the proceeds are exclusively applied to finance or re-finance, in part or in full, new and/or existing eligible green projects that align with the four core components of the Green Bond Principles (GBP).

Speaking at the Nigerian Stock Exchange (NSE) in Lagos, Abubakar said: “The first tranche of the green bond was about N10 billion, the second N15 billion and the third, we are looking at N25 billion. We are moving up in the launch

“We want to embark on more projects that are climate sensitive that will help in eliminating climate problems.”

He stated that the proceed of the green bond will be used to finance power, aforestation, deforestation water, energy, agriculture among other projects among others.

“We are moving to smart agriculture to produce more foods with minimal impact on the environment. The third tranche will further demonstrate the government’s commitment to the reduction of greenhouse gas emissions by 20 per cent unconditional and 45 per cent conditional by 2030, as outlined under the Paris Agreement signed on 21 September 2016,” he said.

According to him, the green bond and the issue of climate change is the defining issue of our time and today we are for the process of issuing the third tranche, which is towards financing green project.

“Green project are what we need today because of the climate issue we as a country is facing, we need to change our environment through solid waste management, turning waste to wealth, wasting to resources, these are all the things we need green bond to finance,” the minister said.

In his remarks, the Chief Executive Officer of NSE, Mr. Oscar Onyema said commended the minister for visiting the exchange, noting that it points to the confidence the government has in the nation’s capital market.

Capital market operators described the issuance of green bond as an opportunity to boost Nigeria’s economic development and for investors to diversify their investments.