Zambia National Commercial Bank (ZANACO) plans to raise $100 million through the country’s first-ever sustainability bond, Chief Executive Officer Mukwandi Chibesakunda announced during a press briefing in Lusaka on Friday.
Over the past few years, sustainability bonds, used to fund projects that provide environmental and social benefits, have been gaining traction in both developed and emerging economies.
ZANACO’s bond will be rolled out in two phases: an initial $50 million private placement expected within six months, followed by a $50 million public offering after the first sale.
Chibesakunda revealed that discussions with private investors are already underway and said their names will be disclosed once agreements are finalized, according to Reuters
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The proceeds from the bond will finance initiatives in renewable energy, sustainable agriculture, and climate-resilient infrastructure, all in line with Zambia’s Green Growth Strategy (2024–2030) and the Climate Change Act.
She described the upcoming issuance as “a promise to channel resources into projects that safeguard the environment and uplift communities,” adding that it marks an important milestone for Zambia’s capital markets.
Although Africa remains a small player in the global sustainability financing space, accounting for less than 1% of the $2.2 trillion green bond market, according to the Africa Policy Research Institute, the need for climate funding on the continent is enormous.
The World Bank estimates that Africa will require about $2.8 trillion by 2030 to achieve its Nationally Determined Contributions under the 2015 Paris Agreement, which aim to cut greenhouse gas emissions and adapt to the effects of climate change.
However, given current funding levels and donor commitments, meeting that target appears unlikely based on historical trends.
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Image Credit: Money Acumen Advisory
