By Hauwa Ali
The African Development Bank (AfDB) has issued its first Environmental,
Social and Governance (ESG) bond (green bond), worth $5.07 million to
strengthen food security, green electrification, industrialization, integration
and improve the quality of life on the continent.
The funds raised over a two-year period is the first green bond issued by
AfDB and will be used to strengthen food security in Africa.
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AfDb, Under its Feed Africa strategy, is working to contribute to reduce
poverty; end hunger and malnutrition; make Africa a net food exporter; and
move Africa to the top of export-orientated value chains where it has a
comparative advantage.
The financing is intended for the implementation of the AfDB’s High 5
program by 2024 and to make Africa a net food exporter by 2025.
“The fixed coupon to be received per bond is 10.5%. Standard Chartered
Bank arranged the transaction under the AfDB’s Multi-Market Debt
Issuance Facility. Capitulum Asset Management is the investor,” says the
financial institution based in Abidjan, Ivory Coast.
According to Keith Werner, head of the AfDB’s Capital Markets and
Financial Operations Division, the aim is to improve the quality of life of
Africans in line with the United Nations’ Sustainable Development Goals
(SDGs).
“We are delighted that our core strengths in African markets have enabled
us to arrange this ‘Feed Africa’ theme bond issuance for AfDB. We look
forward to continuing to strengthen our partnership with multilateral
development banks to help them achieve their common goals.” Dain
Sherborne, head of EM SSA Bond Trading and Annemarie Ganatra, head
of MTNs at Standard Chartered Bank, said.
British International Investment (BII) had also subscribed to a $75 million
basket of green bonds organized by Symbiotics, an emerging market
access platform based in Geneva, Switzerland.
The financing will support micro, small and medium enterprises (MSMEs)
and green projects in Africa and Asia.
These green bonds is intended to finance the installation of rooftop solar
panels, sustainable agriculture, energy efficiency in buildings and electric
vehicles.
