Tuesday 28th September 2021
Tuesday, 28th of September 2021
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Lagos raises bond to address climate change

Lagos State Governor, Mr Babajide Sanwo-Olu, says the state is raising money for the Lagos State Green Bond Market Development Programme.

Lagos green bond
L-R: From left, Commissioner for Finance, Dr Rabiu Olowo; Chief Executive Officer FMDQ Group, Mr Bola Onadele; Lagos State Attorney General, Mr Moyosore Onigbanjo; Gov. Babajide Sanwo-Olu of Lagos State; and Special Adviser Office of Sustainable Development Goals (SDGs) and Investment, Mrs Solape Hammond during the Official Signing of Memorandum of Understanding (MOU) between Lagos State Government and Nigeria Green Bond Market Development Programme at Lagos House Marina on Tuesday

Sanwo-Olu said the bond was geared at building a greater, circular, climate-resilient and prosperous state.

The governor made the remark on Tuesday, September 14, 2021, when he signed a Memorandum of Understanding (MoU) with FMDQ Group and Financial Sector Deepening Africa (FSD Africa), as implementing partners, at Lagos House, Marina.

According to the governor, “Green Bond Framework Development Programme”,  is a crucial first step toward creating a viable financing option for future green and sustainability projects.

Sanwo-Olu noted that Green Bonds could assist in unlocking sustainable investment opportunities in Lagos State, opening the door to advance adoption of innovative new technologies, financing of projects that provided green jobs, and promote economic and climate resiliency.

He lamented that climate change affected everyone, but it was expected to hit developing countries the hardest, especially low-lying states such as Lagos.

He, however, noted that despite its devastating effects, climate change was being increasingly viewed as a gateway to new business opportunities, opening many profitable ways for investors to help protect the planet.

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He added that one of such ways was through Green Bonds.

“Lagos State is particularly mindful of the effects of climate change and as such, has shown and continues to show its commitment to achieving the Sustainable Development Goals (SDGs), a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030.

“To achieve these lofty goals however, funding is required, far in excess of what the state can currently generate and very urgently.

“The financial sector will therefore, need to play a vital role in accelerating the local market’s ability to provide the required support, by expanding to green lending as an alternative source of funding for financing eligible green projects and assets in Lagos state.

“I commend and thank our partners, the Financial Centre for Sustainability, FMDQ Group and FSD Africa, funded by the UK Government, who are supporting this development programme.

“This Green Bond Framework Development Programme is a crucial first step toward creating a viable financing option for future green and sustainability projects.

“There is no doubt that Green Bonds can assist in unlocking sustainable investment opportunities in Lagos state, opening the door to advance adoption of innovative new technologies, financing of projects that provide green jobs, and promote economic and climate resiliency.

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“With an expected population growth to 40 million inhabitants by the year 2050, the government is saddled with not only delivering on economic growth, but mitigating against adverse effects of climate change and waste generation.

“These are all opportunities that Green Bonds can be used to address.”

Sanwo-Olu expressed optimism that the initiative would go a long way toward ensuring actualisation,  adding that his administration would continue  to blaze the trail of leadership, financial accountability, innovation and sustainability.

He said: “I strongly believe that the green bond programme will open the doors of deep sustainable funds for infrastructure and social development for Lagos, being the biggest player in the sub-national capital market, and therefore open new doors overall for lots of others. ”

Earlier, in his remarks, Commissioner for Finance, Mr  Rabiu Olowo, noted that the green bond would address issues of climate change and environmental challenges.

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According to him, Lagos has over 20 years experience in raising bonds. The state raised N100 billion bond in 2020, being the highest raised at that time.

Special Adviser to the governor on SDGs,  Mrs Solape Hammond, said the MoU signing was the start of the framework for managing the bond.

“We will identify the green projects, the state should pursue and that will  determine what amount we will  be looking to do.

“It can be anything between N25 billion to N100 billion, but it really depends on the number of green projects we are able to find,” she said.

The Chief Executive Officer,  FMDQ Group, Mr Bola Onadele-Koko, said the firm was proud to partner the state toward addressing climate and environmental challenges through the bond.

Onadele-Koko noted that the bond would stimulate economic growth, create jobs and align Sanwo-Olu’s THEMES agenda with achieving the SDGs as highlighted by the the United Nations.

“This will also transition Lagos State to a greener and more sustainable economy in line with the UN SDGs. 

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