First Green Bond Lists on London Stock Exchange
President Uhuru Kenyatta has rung the bell on the London Stock Exchange (L.S.E) to acknowledge the cross-listing of the first green bond by a Kenyan company, Acorn Holdings, a property development company that is based in Nairobi.
President Kenyatta, who is in the United Kingdom, for the UK-Africa Summit where 20 African Heads of States were in attendance, including those from Ghana and Mauritania, stated that this government is committed to ensuring that there are favourable policies to attract foreign direct investment into the country.
“Kenya is now committed to ensuring that that there is a policy framework that can contribute to the issuance of Sovereign Green Bond so as to finance sustainable development projects,” he says in a statement.
Apart from being listed on the oldest stock exchange in the world, LSE, the first green bond, was also listed on the Nairobi Securities Exchange (N.S.E) on January 13th, 2020 at a price of Kshs 4.3 billion, as a debt instrument that would enable the company to raise a debt from the public so as to construct six-green and safe certified properties for student accomodation in Kenya it is key for university admission in Kenya.
President Kenyatta spoke on the need for Least Developed Countries (LDC’s) to boos their economic growth by turning to turn to what is environmentally friendly, such as the first green bond by Acorn Holdings.
This is because of the threat that is posed by climate change. In Africa, for instance, most countries are concentrated around coastal areas, yet paradooxically, these are prone to climate change disasters, such as flooding, leading to a shortage of food, states the Foresight Africa 2020 Report.
According to the Africa Growth Initiative by Brookings House further observes that the number of African citizens that are living in such coastal regions is set to increase by the next decade caused by other factors such as population growth and urbanization.
The affected countries include Senegal and Benin, whose populations in the coastal regions will have increased by 2030, by 41 percent and 35 percent, respectively. The coastal regions of such countries by the next decade will have been expected to be more susceptible to cyclones, storms along the coastlines as well as high temperatures coming in from the seas, which would in turn lead to high speeds of wind, that range from 3 to 5 percent, notes Brookings House.
“ Those in the developing countries will have to work differently in the face of the growing climate crisis, in terms of employment opportunities that are in line with the development requirements,” explained Mr Kenyatta.
President Kenyatta further said that Kenya has in the last two years been able to attract foreign direct investments (FDI), unlike previously, with the example being in renewable energy.
He echoes the results of the 2019 World Investment Report published by the United Nations’ Conference of Trade and Development (UNCTAD), which states that in 2018, Africa was the leading continent globally, with an 11 percent growth in the previous year, to record $ 46 billion in FDI.
The World Investment Report further notes that the leading part of the continent is East Africa, which experienced higher growth than the others, with $9 billion in FDIs as of 2018, as compared and Kenya experiencing recording a 27 percent growth.
“ 70 percent of all the power that we generate in the country comes from renewable energy sources due to the FDI that has been pumped into geothermal and wind power production programmes,” he says.
African and European companies funded the largest wind power plant in Africa, the Lake Turkana Wind Power Farm, which was launched in September 2019. With it, the funders hoped to bridge the electricity gap present in the national grid by generating 310 megawatts of electricity.