Chile to issue up to USD-1.5bn sovereign green bond

Chile is preparing to issue a sovereign green bond this year in hopes of raising up to USD 1.5 billion (EUR 1.3bn) in international markets, finance minister Felipe Larrain said Thursday.

Larrain stated that the ministry’s green bond framework has already received positive feedback from international organisations. Vigeo Eiris, an independent rating and research agency, issued a favourable pre-issuance report, while the Climate Bond Initiative (CBI) certified the portfolio of projects that will benefit from green bond proceeds.

According to the framework, the bond pot will be used to support eligible green expenditures through subsidies and tax exemptions, direct funding of the state’s climate strategy, investments in real and intangible assets, among others. The budget will target activities in six sectors defined as green -- clean transportation, energy efficiency, renewable energy, living natural resources, land use and marine protected areas, water management and green buildings.

The Chilean issuance will be Latin America’s first sovereign green bond. So far, the group of green sovereign issuers includes Poland, France, Nigeria, Fiji, Belgium, Indonesia, Lithuania, Republic of Seychelles, Ireland and the Netherlands, according to CBI.

(USD 1.0 = EUR 0.9)

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