The Federal Government of Nigeria has stepped up the regulatory framework and incentives for climate change and also scale up sectors to be included in the proposed second issuance of proposed green bond.
The Minister of Environment, Suleiman Hassan Zama, yesterday disclosed this at a workshop organised by Climate Finance Accelerator held at the Lagos floor of the Nigerian Stock Exchange, NSE. He said:
“The federal government has put a lot of incentives and policy framework including the, Economic Recovery Growth Plan, ERGP which is the number one instrument used for policy affecting environment. It is on page 47 that stated much on issues about environment. Our rating for doing business has improved and is actually getting better by the day. We also have to look at the aspect of fast tracking the issuance aspect of letter of no objection. So far we have issued up to 20 no objection letter to proponents that want to assess the global climate fund. This is an incentive that can attract any developer or any Project Participants that want to bring up projects that is linked to climate change. Also, in the first issuance of our green bond, we focus on forestation and power sector, but now in the second issuance, we have scaled it up to seven sectors which invariable we attract more interest.”
Nigeria’s infrastructure deficit to hit $878 by 2040 — SEC Speaking as well, Fixed Income Product Manager of the NSE, Mr. Ibe Enwo, said the high interest rate has been identified as one of the major challenges faced by Green Bond issuers, stressing that it is expected that new rules and regulations will be issued by the regulatory agencies to further the market bond issuance by sub national and corporate entities.
Commenting on the benefits of green bonds, he said that it provides issuers to diversify and also expand the investor base. He said:
“It provides access to new investors such as sustainable funds which consider Environmental, Social and Governance issues. It has the potentials to attract new investments at cheaper costs, on account of huge demand for bankable green projects over their supply.”
Source Vanguard