FSD Africa and Committee of SADC stock exchanges partner to accelerate green bond uptake

FSD Africa reinforces commitment to the climate agenda through partnership to develop a green bond market in the Southern Africa Development Community. The partnership aims to accelerate the uptake of green bonds by SADC member countries to finance sustainable green projects.

FSD Africa  and Committee of SADC stock exchanges partner to accelerate green bond uptake
Thapelo Tsheole, Chief Executive Officer of Botswana Stock Exchange and Chair of the Committee of SADC stock Exchanges (CoSSE)

FSD Africa (FSDA) has 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 programme will support member countries and both private and public sectors to issue green bonds, creating a favourable ecosystem and improving knowledge and capacity for sustainable investments. The programme will also help SADC countries to develop listing guidelines and regulations for green bonds, build a pipeline of potential green bonds 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.

Mark Napier, CEO, FSD Africa said they 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. “Green bonds can be an excellent way to channel SADC significant capital resources into job-creating projects that can help pivot the region towards a low-carbon economy and protect it from environmental shocks,” Napier said.

Over the last three years, FSD Africa has supported two green bond programmes 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 programme aims to expand its scope to include support for issuing sustainability and social bonds.

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 programme.

CoSSE Chairperson Thapelo Tsheole said 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. As CoSSE, Tsheole says “we usher in this new chapter with pride and we are committed to promoting the uptake of this programme by the SADC region. We extend gratitude to FSD Africa for this partnership and we remain committed to the development of the region”.

In recent years, SADC countries have experienced extreme climate-related challenges including drought and cyclones. “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,” UK Minister for Africa, James Duddridge said.  “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”.