Morocco’s first green bond has been issued with the goal of providing Banque Centrale Populaire with €135 million to finance projects that could cut up to 17 million tonnes of carbon emissions.
IFC, a member of the World Bank Group, and Proparco, a subsidiary of Agence Française de Développement (AFD), provided the banking group with financing for the 10-year instrument. IFC provided €100 million while Proparco provided €35 million.
“Addressing climate change is a priority for IFC in the region and Morocco is an active player in this area,” said Mouayed Makhlouf, IFC director for the Middle East and North Africa.
Makhlouf added that IFC’s partnership with the bank aims to attract more private sector investment in long-term renewable energy projects.
The investment is projected to reduce CO2 emissions by 938,000 tonnes on average per year, following a commitment made by Morocco during the COP22 climate conferences in Marrakesh in 2016. Once all projects are completed, emissions reductions could reach 17 million tonnes, according to a statement released by Proparco.
Yazid Safir, Proparco’s regional representative in North Africa, said the bond would allow Proparco to “stimulate the Moroccan capital market and develop new subscriptions for green bonds in other regions,” while further strengthening its partnership with the banking group.
In November 2016, IFC published its Climate Investment Opportunities Report, in which it draws a 12-year timeline to 2030 showing around US$23 trillion of renewable energy investment opportunities, US$68 million of which are identified in Morocco.
Proparco expects to deploy €2 billion for green projects by 2020. IFC, its larger peer, has issued US$5.8 billion in green bonds in 12 currencies as of June 2017.