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Belgium joins green bond club with 4.5 billion euros

Staff Writer |
Belgium has issued its first sovereign green bond worth EUR 4.5 billion ($5.54bn) that will help it finance environmental and clean energy initiatives, the country's Debt Agency said.

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The bonds mature in 15 years (April 22, 2033) and carry a coupon of 1.25%. Barclays, BNP Paribas Fortis, Credit Agricole, ING Groep NV and JPMorgan Chase & Co were hired as joint bookrunning managers of the transaction.

Innitially, Belgium hoped to raise between EUR 3 billion and EUR 5 billion.

In its green bond framework, published earlier in February, the Belgian government said funds from the deal will be allocated to finance projects in five main green sectors - clean transportation, energy efficiency, renewable energy, waste management and circular economy adapted products and living resources and land use.

The offering has made the country the third one in Europe to offer such financial instruments, following the example of Poland and France.

Poland was the world’s first sovereign issuer after in December 2016 it raised EUR 750 million from selling five-year green bonds.

Its pioneering move was later followed by other countries, including France, Fiji, Nigeria and Indonesia. Just last week, the latter raised $1.25 billion from the issuance of its debut green sukuk bond.

Total green bond issuance reached $155.5 billion at the end of 2017, a new global record, up 78% on the adjusted 2016 figure of $87.2 billion. This year, the market for green bonds will expand to between $250 billion and $300 billion, the Climate Bonds Initiative (CBI) projects.

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