Background

The global green bond market was worth 41.8 billion USD in 2015, and is projected to continue its substantial growth in the coming years. These bonds represent an effective means to finance or refinance environmental, sustainable and climate projects.

The Colombian Government aims to increase public and private investment in climate change in order to meet the Colombian Nationally Determined Contribution targets, which require the diversification of funding sources and mechanisms to promote an efficient allocation of resources. The analysis that supported the formation of the Colombian Strategy Framework for Climate Funding highlighted green bonds as an ideal instrument to leverage resources and to ensure market investment in climate projects. In this context, the Government of Colombia has decided to evaluate the feasibility and potential of a market for green bonds in the country.

The vision

Colombia aims to structure an efficient market for green bonds allowing it to finance large projects in mitigation and adaptation to achieve and foster climate compatible development.

Goals

This project, carried out in close collaboration with the Financial Management Committee SICLIMA of Colombia and the Climate Bonds Initiative, seeks to:

• Assess the current state of the market for green bonds and their potential use as an instrument to finance projects associated with climate change in Colombia.
• Improve understanding of the applicability of green bonds in the country.
• Involve key market players, in particular from the private sector, to help foster demand and tailor supply of green bonds.
• Create a roadmap for the effective development of a green bond market.
• Support the design of a pilot programme to issue green bonds.

Beneficiaries

• Direct beneficiaries: Financial Management Committee, SISCLIMA.
• Indirect beneficiaries: financial and banking institutions.

Deliverables: 

Road map - Actions for setting a green bond market in Colombia

Country: Colombia

Suppliers: Ecology, Economy and Ethics (E3) and PwC

Project Funding: £60,011