Green Exchange anticipates $5b in bond sales in 5 years
By Jeph Ajobaju, Chief Copy Editor
African fintech The Green Exchange hopes to raise $5 billion in green bond sales within five years in Nigeria, Ghana, Kenya and others to fund green bond projects across Africa.
It aims to make the investment open for investors to trade the debt in a secondary market on projects like wind turbines, electric vehicle charging stations, sustainable housing, and solar panel installations to help mitigate climate change.
Bloomberg reports that Egypt, Nigeria, and South Africa are issuing green bonds in Africa, with China in Asia and Chile in South America as major sellers.
Green Exchange co-founders Orla Enright and Diana Amoatin said they will start by raising $2 million to build a virtual marketplace by July for both debt and equity, using crowdfunding on the equity side and green bonds on the debt side.
Green Exchange CEO Enright reiterated that Africa has missed out on a global boom in borrowing to fund projects that help mitigate climate change.
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Positive response to green bonds
Enright said the reaction of companies in the region to issuing corporate green bonds is positive.
According to her, global investment in green bonds is expected to reach $1 trillion in 2022 but the African market contributes only 0.4 per cent of the global market for green bonds, per reporting by Nairametrics.
She said developed nations making investments in Africa have greater interest in climate change and investment funds for developing countries.
“We will be targeting an increasing number of North American and Scandinavian institutional funds incorporating ESG as one of their main criterion of investment,” she stressed.
Africa stands at risk from climate change and also suffers from a high cost of finance, but Overseas Development Institute said green bonds solutions would help mobilise $50 billion yearly to address the problems.
