Government Launches Green Bond Project

The Government has launched a Green Bond Project, intended to raise funds on the domestic and regional debt capital markets to finance the implementation of climate-related or environmentally sustainable activities locally.

These include engagements targeting energy efficiency; clean transportation; pollution prevention; sustainable agriculture, fisheries and forestry; protection of aquatic and terrestrial ecosystems; clean water; and sustainable water management.

The project, titled ‘Facilitating an Enabling Environment for the Caribbean Green Bond Listing on the Jamaica Stock Exchange’, is being jointly implemented by the Climate Change Division (CCD) in the Ministry of Housing, Urban Renewal, Environment and Climate Change, and the Jamaica Stock Exchange (JSE), with support from the Green Climate Fund.

It is expected to culminate in the listing of green or climate bonds on the JSE by mid-2022, targeting local, regional and global investors,

Speaking during the launch on Wednesday (June 23), which was hosted physically and virtually at the JSE in downtown Kingston, Minister of Housing, Urban Renewal, Environment and Climate Change, Hon. Pearnel Charles Jr., said the initiative is a “seminal” project that represents a “truly watershed moment for our country”.

“We have set out to reduce greenhouse gas emissions of 25.4 per cent by 2030 on our own, and 28.5 per cent, by that time, with international support. We are sending a very strong signal to our development partners that [in] Jamaica, we are taking charge of our development and advancement as a country [by] recognising the need for climate action,” he pointed out.

Mr. Charles acknowledged that the climate projects targeted for implementation locally are “ambitious”, noting that “the public purse does not have the capacity to supply the large sums that are going to be required for us to really implement these”.

Against this background, the Minister said the bulk of the funding “must come from the international public finance and local and international private investments… in this case, through the green bonds”.

Noting that the instruments have been used successfully by the World Bank and countries in Europe, Africa and Asia, Mr. Charles said green bond issuance accounted for US$161 billion worth of investments worldwide in 2017, according to global rating agency Moody’s, and US$257.5 billion in 2019, according to investor-focused non-profit group Climate Bonds Initiative.

“What it means is that all indications point to the incredible potential and unlocking of potential for Jamaica, as we seek to realise our domestic targets as per the National Development Plan, Vision 2030 Jamaica, and as we seek to move towards the advancement of our international commitments as per the Paris Agreement, and our nationally determined contributions,” Mr. Charles Jr. said.

Managing Director, JSE, Marlene Street Forrest, said the Green Bond Project represents a “tangible and proactive approach” by the Government to build the necessary structures for environmental resilience through collaboration.

“This project is expected to be transformative for Jamaica and the Caribbean. Not only are we exploring and designing frameworks for the measurement and certification of green [ecosystems], we are also ensuring that we direct capital flow into our region… [and] that’s very important for us,” she added.

Meanwhile, Principal Director for the CCD, UnaMay Gordon, welcomed the partnership forged with the JSE, “which has enabled this [green bond] project to move forward”.