By the end of the year, Zambia’s Copperbelt Energy Corporation (CEC) will issue the country’s first green bond, according to a statement released by the power company on Tuesday. The note, valued at $54 million, will be offered as part of a green bond program valued at $200 million.
Owen Silavwe, the chief executive officer of CEC, stated in a statement made on the margins of the COP28 climate meeting that the earnings will be used to support solar energy development. This is part of the company’s goal to create 200 MW of renewable energy.
The use of green bonds has become increasingly widespread around the world as governments and bankers look for market-driven solutions to address the issue of climate change. In addition, it is a component of a more significant trend in finance connected to environmental, sustainability, and governance (ESG) objectives.
In December 2022, Zambia completed the legislation that would allow for the issuance of green bonds locally to assist initiatives connected to climate change.
In the release, Nonde Sichilima, a director at Zambia’s Securities and Exchange Commission, stated, “We anticipate that the CEC’s announcement will catalyze the listing of more green bonds as a means of capital raising for green initiatives and contribute towards deepening capital in our country.” Sichilima was referring to the fact that the news will stimulate the listing of more green bonds.
For the Carbon Exchange Corporation’s (CEC) green bond program, Cygnum Capital served as the principal arranger. At the same time, the Emerging Africa Investment Fund, “in partnership with” the South African bank Absa, was the cornerstone investor.
The Emerging Africa Investment Fund, in turn, is a subsidiary of the Private Infrastructure Development Group, a joint venture between six industrialized nations and the World Bank’s International Finance Corporation.