The Federal Government is planning to raise up to N500 billion through the issuance of green bonds this year in furtherance of its fiscal measures for alternative financing to fund climate-related and environmental projects in the country.
The Minister of Environment, Balarabe Abbas Lawal, was quoted by Bloomberg as giving this hint on Tuesday at the Abu Dhabi Sustainability Week Forum
The Minister explained that proceeds from the green bond issuance would be channelled into projects to improve air quality, expand access to clean cooking fuels, and frontally address deforestation challenge.
According to him the initiative aligns with Nigeria’s broader climate commitments and environmental sustainability goals, while also tapping into rising global investor appetite for green and sustainable finance instruments.
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The proposed issuance reflects Nigeria’s growing use of climate-linked debt instruments to explore funding sources beyond oil revenues and conventional borrowing.
When analyzed within the context of the Federal Government’s fiscal policy and tax reforms initiative, green bonds offer the government alternative funding source for climate and infrastructure projects without relying too much on volatile oil revenues, the country’s main source of foreign exchange.
The government had, in the past two years successfully issued green bond for climate projects. For instance, last year the Federal Government issued a N50 billion green bond, which was oversubscribed, attracting more than double the amount on offer.
Earlier, the Federal Government’s maiden sovereign green bond was also fully oversubscribed, indicating foreign investor confidence in the country’s climate-linked debt instruments.
It would be recalled that yesterday, President Bola Tinubu approved the implementation of Nigeria’s carbon market framework from which the government is expecting to generate at least $3 billion annually effective from 2030 to ensure improved funding of climate change and related projects in the country.
