Absa lists Botswana Stock Exchange’s first sustainable bond

Key Takeaways

Green, Social, and Sustainable (GSS) bonds have gained significant traction on a global scale as policymakers and financiers seek market-driven solutions to address climate change. This trend is part of a broader surge in financial instruments aligned with environmental, sustainability, and governance (ESG) objectives. Despite Africa holding 23% of official climate finance, the continent accounts for less than 1% of global green bond issuances. Moreover, African nations face the challenge of paying more than twice the rates of similarly rated peers to access financial markets. Presently, Africa faces a multitude of pressing issues, including a high debt burden, historical challenges with borrowing costs, post-COVID recovery, climate change impacts, and shortages in energy and food due to the conflict in Ukraine. Given these challenges, there is an increased urgency to explore innovative avenues for raising funds from private investors within a transparent and efficient framework, and at reasonable rates. This becomes crucial to navigate the complex landscape and address the diverse economic and environmental challenges facing the continent.