Fiji has become the first emerging market to issue a sovereign green bond after it raised 100 million Fijian dollars to finance climate mitigation and adaptation projects.
At the request of Fiji’s Reserve Bank, the World Bank and the International Finance Corporation (IFC) provided technical assistance to support the Government in issuing their first sovereign green bond.
Sustainalytics US, an environmental consultancy, evaluated Fiji’s Sovereign’s green bond transaction and its alignment with the Green Bond Principles.
The green bond will primarily be used for climate resilience, but also on renewable energy projects supporting the nation’s commitment to reduce carbon emissions from the energy sector by 30 percent by 2030.
The bond has two maturity dates with a tenure of 5 years and 13 years.
The shorter tenure bond has a coupon rate,- the yield the bond paid on its issue date, of 4.00 percent while the longer duration bond will have a coupon rate of 6.30 percent, which is highly attractive given the coupon rate for the French bonds was just 1.75 percent.
The green bond was issued under the broader, three-year Capital Markets Development Project supported by the Australian Government, where Australia and IFC support the stimulation of the private sector to promote sustainable economic growth and reduce poverty in the Pacific.
Frank Bainimarama, Fijian Prime Minister and President of COP23 said: “The Fijian people, along with every Pacific Islander, live on the front lines of climate change”.
“I have made access to climate finance a key pillar of our upcoming COP23 Presidency, and we are proud to set an example to other climate-vulnerable nations by issuing this green bond to fund our work to boost climate resilience across Fiji”.
“By issuing the first emerging country green bond, we are also sending a clear signal to other nations that we can be creative and innovative in mobilizing funds and create win-win outcomes for countries and investors in adapting to the serious effects of climate change”.
Jim Yong Kim, World Bank Group President said: “With this bond, Fiji has demonstrated that green capital markets can be created in emerging economies and that all countries, big and small, have an important role to play in facilitating climate solutions”.
“As it takes the helm of COP23, Fiji is uniquely positioned to inspire other countries to meet their respective targets and build resilience against climate change”.
Fiji constitutes 300 volcanic islands that includes low-lying atolls that are highly exposed to cyclones, while the nation is also highly vulnerable to the impact of climate change with 20 percent of the region’s people at risk of migration by 2050.
Fiji’s sovereign green bond was the third to be issued globally, with Poland’s €750 million bond in December 2016 being the first, followed by a €7 billion issuance from France in January 2017.
According to the World Bank, the green bond market is expected to reach $134.9 billion in 2017.
The Government of Fiji will chair COP23 in Bonn, Germany, from November 6-17.
Published on Climate Action Programme on October 30, 2017.
Human rights and environment
In recent years, the recognition of the links between human rights and the environment has greatly increased. The number and scope of international and domestic laws, judicial decisions, and academic studies on the relationship between human rights and the environment have grown rapidly.
Many States now incorporate a right to a healthy environment in their constitutions. Many questions about the relationship of human rights and the environment remain unresolved, however, and require further examination.
As a result, in March 2012 the Human Rights Council decided to establish a mandate on human rights and the environment, which will (among other tasks) study the human rights obligations relating to the enjoyment of a safe, clean, healthy and sustainable environment, and promote best practices relating to the use of human rights in environmental policymaking.
Mr. John Knox was appointed in August 2012 to a three-year term as the first Independent Expert on human rights obligations relating to the enjoyment of a safe, clean, healthy and sustainable environment. His mandate was further extended in March 2015 for another three years as a Special Rapporteur.
The resolution 16/11 adopted by the Human Rights Council on 12th of April 2011 entitled “Human Rights and the environment” requested the Office of the High Commissioner “in consultation with and taking into account the views of States Members of the United Nations, relevant international organizations and intergovernmental bodies, including the United Nations Environment Programme and relevant multilateral environmental agreements, special procedures, treaty bodies and other stakeholders, to conduct, within existing resources, a detailed analytical study on the relationship between human rights and the environment” (para.1).
See also the Special Rapporteur on the implications for human rights of the environmentally sound management and disposal of hazardous substances and wastes
Human rights and climate change
In its 5th Assessment Report (2014), the Intergovernmental Panel on Climate Change (IPCC) unequivocally confirmed that climate change is real and that human-made greenhouse gas emissions are its primary cause. The report identified the increasing frequency of extreme weather events and natural disasters, rising sea-levels, floods, heat waves, droughts, desertification, water shortages, and the spread of tropical and vector-borne diseases as some of the adverse impacts of climate change. These phenomena directly and indirectly threaten the full and effective enjoyment of a range of human rights by people throughout the world, including the rights to life, water and sanitation, food, health, housing, self-determination, culture and development.