June 7, 2021
Pakistan Rolls Out Plans To Tap Global Green Financing Avenues
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Pakistan Rolls Out Plans To Tap Global Green Financing Avenues

The federal government on Thursday said it has initiated work on a number of green financing instruments, buoyed by widespread global investor interest in Pakistan’s first green bond floated in the international market last week.

 

The Water and Power Development Authority (Wapda) issued Pakistan’s first green Eurobonds in US dollars on May 27, seeking $500 million for environmentally friendly projects to increase the share of clean energy in Pakistan’s power generation mix, which is heavily reliant on fossil fuels, particularly coal.

 

 Which shows there is a global appetite for a country that has economic stability and as well as green credibility,” Prime Minister’s Special Assistant on Climate Change Malik Amin Aslam told Reuters.

 

Pakistan, which is the host country of the United Nations’ annual World Environment Day on June 5, is one of the world’s most susceptible countries to climate change, having been affected severely by extreme weather events such as disastrous floods. It is currently attempting to establish itself as a key participant in the global green financing sector.

 

Prime Minister’s Special Assistant on Climate Change Malik Amin Aslam said that the government intends to expand the use of green bonds for construction and transportation finance.

 

On Thursday, the government also concluded its first blue bond evaluation, a financing instrument that gathers funds from worldwide investors for projects that conserve ocean ecology and allied businesses like fisheries and eco-tourism.

 

Aslam stated that Pakistan has launched its first blue carbon estimates with the help of the World Bank for this purpose. He stated that the World Bank predicted that if the country’s new plantation program, which include planting 10 billion trees over the next several years, are successful, they will be worth $500 million by 2050. He said that the World Bank had used conservative projections for a carbon price and that the valuation could go up to $2.5bn.

 

Pakistan also issued a joint statement on Thursday with Canada, Britain, Germany, and the United Nations Development Programme outlining its efforts to establish a “Nature Performance Bond” to provide the country with accelerated access to development financing and debt relief in exchange for meeting ecosystem restoration targets.

 

“The nature bond is chartering unchartered territory,” Aslam said. The bond will be developed by a consortium of financial advisers and is in its initial stages.

 

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