FSD Africa Signs Agreement To Support A Green Bond Market

FSD Africa (FSDA) has today signed a Co-operation Agreement with the Committee of SADC Stock Exchanges (CoSSE) to support the development of a green bond market in the SADC region.

The agreement will support the SADC’s 16 member countries to leverage domestic and international capital markets for investment in green projects.

The FSD Africa-CoSSE partnership program will support member countries and both private and public sectors to issue green bonds, creating a favorable ecosystem and improving knowledge and capacity for sustainable investments.

The program will also help SADC countries to develop listing guidelines and regulations for green bonds, build a pipeline of potential green bond issuers, tap the countries’ institutional investment community for investment into green bonds, train stakeholders on climate finance and support the adoption of climate-related financial reporting and disclosure.

Recently, South Africa, Namibia, Seychelles, and Mauritius have successfully issued green bonds. The partnership builds on the increasing appetite and momentum for the uptake of green bonds in the SADC region. It will be implemented through CoSSE’s central coordination mechanism, which links together the SADC countries’ stock exchanges, capital markets institutions, and stakeholders. FSD Africa will provide technical assistance in engaging consultants and service providers to facilitate the program.

Over the last three years, FSD Africa has supported two green bond programs in Kenya and Nigeria in collaboration with implementing partners and helped channel approximately $185 million into sustainable investments in the two countries. Going forward, the FSD Africa-CoSSE partnership program aims to expand its scope to include support for issuing sustainability and social bonds.

Mark Napier, CEO, FSD Africa said: “FSD Africa is excited to be extending its technical support for green bonds to the SADC region and we are grateful to COSSE for the partnership. We are confident that green bonds will soon play a critical role in financing the region’s growth, accelerating the bounce-back from Covid-19 and ensuring the recovery is both resilient and respectful of the environment.’

Evans Osano, Director, Capital Markets, FSD Africa added: “Managing climate change in Africa is essential for the continent to meet its sustainable development goals. However, we know that climate projects need a source of reliable, sustainable funding to get off the ground and positively impact the climate ecosystem.’

James Duddridge, UK Minister for Africa, said: “Climate change is the most important challenge facing future generations and ahead of COP26, our partnerships with African nations are building resilience and driving clean growth. This landmark agreement will increase access to green finance, create jobs and help support a sustainable recovery from COVID-19 to deliver for those on the forefront of the climate crisis and our planet”.

Thapelo Tsheole, CoSSE Chairperson said: “CoSSE is pleased to consistently deliver on its objective to encourage the transfer of securities markets’ intellectual capital and technical expertise of member countries of CoSSE. This milestone Co-operation Agreement with FSD Africa to support the development of a green bond market in the SADC region represents the hard work and commitment to the development of African capital markets by both parties.”