I am highly delighted to welcome you all today to this Stakeholders Investment Conference, an idea which was born during our first Advisory Group Meeting in September 2016.
The Green Bonds process is an attempt by the Environment sector to contribute to this Administration’s efforts to diversify the economy, create jobs, improve security, provide a framework for Sustainable Development and deliver on the Paris Agreement.
Under the Paris Agreement, developed countries reaffirmed their commitment to mobilise $100 billion of resources by 2020 to support developing countries ‘enhance the implementation of their policies, strategies, regulations and action plans and their climate change actions with respect to both mitigation and adaptation.’ This objective will remain in place to 2025 and will act as a floor from which flows shall increase beyond 2025. The provision of these resources will be indispensable if Nigeria is to realise its NDC, especially the 45% emissions reduction and the adaptation and resilience building activities.
The Paris Agreement which was signed by Mr. President enabled us to develop our Nationally Determined Contribution (NDC) and constitute the Inter-Ministerial Committee on Climate Change charged with the responsibility for cross sectoral integration of Climate Change issues into main stream planning and also to identify a pipeline of projects which the Green Bonds will fund. The delivery of Nigeria’s NDC will require a fundamental re-orientation of financial flows within the economy. Capital will need to flow toward low-carbon, climate resilient 2 opportunities and away from carbon intensive, polluting activities or those that exacerbate climate vulnerability leading to poverty, insecurity, reduced health quality etc.
L – R shows, Babatunde Fashola, Honourable Minister of Power, Works and Housing; Oscar N. Onyema, OON, Chief Executive Officer, The Nigerian Stock Exchange (NSE); His Excellency, Prof Yemi Osinbajo, SAN, GCON, Acting President of The Federal Republic of Nigeria and Amina I. Mohammed, Honourable Minister of the Environment at the Green Bonds Capital Market and Investors Conference at the NSE today.
Green Bonds present an opportunity for us to begin to achieve this. The process which will see Nigeria launch the first Sovereign Green Bonds in an emerging market began as a seed which was sown by the Private Sector – the Nigerian Stock Exchange – So you can say we have achieved half the circle and will come full circle when we finally issue the Bonds this quarter.
Since we began this journey we have taken a number of steps (which you will hear, later on,) to ensure that we are able to sustain a bigger plans for the inflow of additional funds through subsequent issuances thus beginning the process of attempting to green our economy.
The Government’s new proposed Economic Recovery and Growth Plan identifies the Green Bonds as one of the alternative sources of financing. The Plan also has significant overlaps with our NDCs on objectives for Power, Transport and Agriculture. For instance, In the power sector target includes 13,000 MWs of off grid solar projects; in transport – implementing schemes that reduce the incidence of cars by introducing and encouraging the use of buses. Attracting climate resources to these interventions expands funding that will be available to our economy
All these are meant help us achieve a target of 450 m tones in emissions reductions.
Our green bond process contributions to emissions reductions by identifying projects within various sector strategies. We can confidently say that we are able to contribute at least 158,000 tonnes to this target. A small number but a concrete step.
We also anticipate jobs of at least 10% of the ERGP’s target of 15million jobs by 2020.
In addition, there are 91 global climate funds that have commitments from the global community to provide up USD100b per annum to fund them. Finding the meeting point between the ERGP and access these funds is a result the Green Bonds process can facilitate.
Sustaining the Process
The Institutional arrangement around the Green Bonds process have been established whilst some already existing processes will require some change.
The Inter-Ministerial Committee on Climate (ICCC) under the coordination of the Department of Climate Change in the Ministry of Environment has been the platform to interrogate the sector strategies, and has been very productive in providing a pipeline of projects that can keep this going beyond March.
The Ministry of Environment itself will be part of the issuance process. It has provided the framework and guidelines, produced as part of the establishing processes essential to ensure that projects funded by green bonds have climate credentials. It will also ensure that the emissions are captured regularly and reported to investors and the appropriate global authorities. In addition, our apex regulator will need to adapt its listing rules to include green bonds.
The Ministry of Finance through the Debt Management Office who are responsible for managing the process have been instrumental to laying solid foundations for this process. Other partners on the Government side – the Ministry of Budget and National Planning, The Office of the Accountant General, The Central Bank of Nigeria have all taken steps to guide this in the right direction and are making the necessary adjustment to processes to ensure this succeeds.
The improving partnership with Government and the Private Sector will keep the momentum of the Green Bonds process. It provides opportunities for the Private Sector to being the process of connecting the three strands of sustainable development – economic, social and environment for long term Sustainable Development.
What do we take away from here?
Government is ready and committed to diversifying the economy, creating Jobs, improving security and improving quality of life.
Green Bonds provides a new product with new credentials that investors can buy into which has gone through a vigorous process to ensure transparency, accountable use of funds and is environmentally friendly.
Our domestic market need to rally around our own domestic issuances. The recently issued Euro Bonds are a testament to us that the Nigerian Market is still viable. So, let’s translate that to domestic issuances.
Greening our economy and financial systems will in the long run support our sustainability efforts and improve the economy as it will open new avenues for new types of jobs, innovation and skill.
Improve partnerships and collaboration with Private sector is key and we must continue to encourage it.
I want to thank His Excellency, the Acting President for his support and being here personally. Our Partners and our Sponsors for supporting the process and welcome you all to what I hope will be a successful event and encourage investors’ appetite.
I thank you all for your attention and wish you a successful conference.