Guidance for Sovereign Green Bond Issuers : With Lessons from Fiji's First Emerging Economy Sovereign Green Bond
A sovereign green bond presents countries with an opportunity to demonstrate national leadership in the green financing agenda while giving exposure to a new investor base and solidifying a country’s commitment to complying with the Paris Climate C...
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| Format: | Working Paper |
| Language: | English |
| Published: |
Washington, DC
2018
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| Online Access: | http://documents.worldbank.org/curated/en/813671525333162636/Guidance-for-sovereign-green-bond-issuers-with-lessons-from-Fijis-first-emerging-economysovereign-green-bond http://hdl.handle.net/10986/29783 |
| Summary: | A sovereign green bond presents
countries with an opportunity to demonstrate national
leadership in the green financing agenda while giving
exposure to a new investor base and solidifying a country’s
commitment to complying with the Paris Climate Change
Agreement. While green bonds allow sovereign issuers to
appeal to a new class of investors, domestically or
internationally, in addition to the usual costs associated
with the preparation of a vanilla government bond, green
bonds require upfront and ongoing resources that are not
recoverable through bond proceeds. Many potential investors
need to be educated on the benefits of a green bond, for
themselves and the country. Studies have shown an increasing
number of millennials are attracted to investments that will
have a positive environmental impact, making it a wise
choice for retail issuances and institutions whose customer
base will increasingly include millennials. Clearly
identifying the reasons for issuing will drive many
decisions in the issuance process. If a country’s motivation
to issue a green bond is prompted by a desire for cheaper
financing compared to a vanilla issuance, then caution
should be exercised. While it has been suggested they may
have the potential to attract a pricing premiu |
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