The Chief Executive Officer of Nigerian Exchange Limited (NGX), Mr Temi Popoola, said that the limited flow of climate finance remains a major hindrance to the implementation of mitigation and adaptation actions in Nigeria and Africa as a whole.
Popoola stated this during the ‘Green and Sustainability Bond’ workshop held in Lagos today.
MoU with IFC: During the workshop, the NGX and International Finance Corporation (IFC) signed a Memorandum of Understanding (MoU) to deepen green bond sustainability in Nigerian capital markets
Popoola recalled that the NGX conceptualized and developed the Green Bond Product Paper in 2016. The concept was embraced and championed by the Debt Management Office (DMO) and the Federal Ministry of Environment in recognition of the climate finance needs and the urgent actions required to combat climate change and its impact.
First green bond: Following the conceptualisation of the Green Bond Paper in 2016, the first green bond was issued in 2017. Popoola explained:
- “This endeavour resulted in the issuance of the first N10.69 billion or about $25.8 million 5-year green bond in 2017 to fund renewable energy development projects. This followed the Federal Government of Nigeria’s ratification of the Paris Climate Agreement, which necessitated the need for long-term financing to meet Nigeria’s NDCs in lowering greenhouse gas emissions.”
He said the bourse in its collaboration with internationally recognized organizations such as the IFC is targeted at sharing valuable green finance experiences and best practices, as well as promoting the development of sustainable finance market segments for supporting the government, policymakers, regulators, financial market participants, domestic and international thought leaders, investors, and other market stakeholders.
He expressed that the management of the Exchange is committed to promoting the development of long-term financial solutions that take into account the financial risks and possibilities posed by climate change.
Expectations from the MoU: The Senior Country Manager, IFC, Kalim Shah said the corporation is partnering with NGX on sustainable financial products in the capital market and country at large.
He noted the MoU signed with Exchange targeted at facilitating knowledge sharing with capital market stakeholders on green social and sustainability.
He disclosed that IFC has invested more than $ 10 billion in green bonds globally since 2010 across 178 bonds in 20 currencies.
The Director, of the Department of Climate Change, Federal Ministry of Environment, Dr Iniobong Abiola-Awe, who was representing the Honorable minister of environment, Mohammed Abdullahi, reiterated President Muhammad Buhari’s commitment to reaching net zero emissions by 2060.
She called on market stakeholders to think of innovative ways of financing key green bond projects to tackle climate change issues in the country.