BSS, Dhaka :
Bangladesh Bank (BB) may channelise some its foreign exchange reserve to the green bonds, said Governor Dr Atiur Rahman.
“BB is actively seeking to deploy some of its foreign exchange reserves in investments in liquid issues of green bonds of multilaterals and other highly rated financial corporate,” the governor said at the closing session of the Global Green Growth Forum (3GF), held Tuesday in Copenhagen, Denmark, according to a BB release issued here Wednesday.
Green bonds, also known as climate bonds, are issued for arrange necessary finance for climate change solutions, The World Bank (WB) already issued such bonds, and so far raised over $6.8 billion to finance green initiatives. The 3GF in Copenhagen also discussed about issuing the green bond in a broader aspect when Dr Atiur came up with the suggestion that the bond should be issued only to finance eco-friendly projects.
As many organisations like the World Bank consider the green bonds as an opportunity to invest in climate solutions through a high quality credit fixed income product, BB is planning to invest in such product from its phenomenally high reserve, which already crossed $22 billion dollars.
The governor said besides traditional long term investors like life insurers and pension funds, sovereign wealth funds and new multilateral fund initiatives like the proposed BRICS infrastructure fund can make big contributions in promoting financing of global green growth.
Dr. Atiur said green project initiatives find it difficult to raise debt finance cost effectively from the underdeveloped local capital market, requiring them to lean excessively on bank financing.
He, however, mentioned that BB had long been looking for ways of developing liaison between networks of local green project entrepreneurs and multilaterals like the WB and the International Finance Corporation (IFC) that raise green bond funds on their own high credentials for investments in eligible green project initiatives.
He also mentioned about the Bangladesh’s initiatives on the transition to green growth and BB’s efforts to promote financing of the transitions to the green growth processes.
