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IFC and Proparco invest in Moroccan green bond

Africa Global Funds
June 28, 2017, midnight
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IFC and Proparco, have invested €100m and €35m, respectively, in the first green bond issuance by Banque Centrale Populaire (BCP), to promote sustainable, environment friendly projects in Morocco. 

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IFC and Proparco, have invested €100m and €35m, respectively, in the first green bond issuance by Banque Centrale Populaire (BCP), to promote sustainable, environment friendly projects in Morocco. 

This is the first green bond issuance in foreign currency in Morocco, as well as IFC and Proparco’s first green bond investment in the region. 

“This historic investment is in line with commitments made by Morocco during COP22 in Marrakech, last year,” said Yazid Safir, Proparco Regional Representative in North Africa. 

“This pioneering operation for Proparco will allow us to stimulate the Moroccan capital market and develop new subscriptions for green bonds in other regions, while further strengthening our long-term partnership with the BCP group.”

The 10-year maturity bond will be used to provide long-term funding for BCP, one of Morocco’s largest banking groups, to refinance investments in selected renewable energy projects in the Kingdom. 

A key objective is to help create a sustainable financing mechanism for banks to support long-term investments in green assets, by channeling private institutional money to climate finance through capital markets. 

IFC’s investment is part of its strategy to create markets by unlocking investment for private sector projects, and meet the increasing demand for renewable energy and energy-efficient projects. 

“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. 

“By building on our long-term partnership with BCP, we aim to encourage more private sector investment in long-term renewable energy projects, paving the way for more sustainable economic development and growth.” 

IFC’s Climate Investment Opportunities Report, released in November 2016, identified $23trn in investment opportunities in 21 emerging market countries by 2030, and $68m in Morocco alone in select sectors. 

Climate is also central to Proparco’s priorities, with the institution earmarking €2bn by 2020 for green projects.

The financing is expected to help save 938,000 tons on average of CO2 emissions equivalent per year, as well as the equivalent of 17.36 million tons of CO2 in greenhouse gas savings over the remaining lifetimes of the projects being financed. 

“This strategic operation cements our position as a pioneer in the financing of renewable energy projects," said Abdeslam Bennani, Deputy CEO in charge of Corporate and Investment Banking at BCP. 

“It also recognizes the confidence and trust placed in the BCP Group by the largest international financial institutions.” 

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Africa Global Funds (AGF) is a monthly magazine for asset management professionals and institutional investors worldwide interested in the African continent. AGF was created as a relevant and engaging resource that can provide readers with an insight of what is going on in the African asset management space. Drawing on an intense dialogue with a constantly expanding group of key decision-makers in the industry, we cover traditional and alternative asset classes of African asset management. From this dialogue we work hard to produce a compelling blend of hard news, incisive commentary, detailed sector and regional reports, exclusive interviews and proprietary data.

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