Nigeria to sell first African sovereign green bond

Bloomberg

Nigeria, Africa’s biggest oil producer, is set to become the first country on the continent to issue a security that raises funds for environmental projects when it launches its green bond on December 18.
The government plans to sell 10.7 billion naira ($30 million) and the offer is billed to close on December 20, said Lanre Buluro, director of sales at Chapel Hill Denham, the financial adviser for the issuance. The offer, which will be listed on the Nigeria Stock Exchange, is the first tranche of a 150 billion-naira program, Moody’s Investors Service said in a statement.
Nigeria plans to use the bond to finance projects in its 2017 budget including renewable-energy micro-utilities and forestation programs, the Debt Management Office said in an emailed statement. A road show for prospective investors is planned in the capital, Abuja, and in the commercial hub of Lagos, it said. The pricing will reflect secondary market rates, DMO Director-General Patience Oniha said at a press conference in Abuja. The bond will enable the West African country, which aims to reduce its CO2 emissions by 40 percent by 2030, to “support initiatives aimed at moderating climate change by investing in solar plants, hydro power and agriculture,” Buluro said by phone from Lagos.
Nigeria, which derives more than 90 percent of its export inco-
me from crude, will become the world’s fourth sovereign issuer of green bonds. Africa’s biggest economy is reeling from its worst economic slump in about 25 years due to lower crude output and a slow recovery of oil prices last year, pushing it to tap debt markets to fund its budget.