Namibia Says EU Initiative’s Delay Affects Green-Bond Plans

(Bloomberg) -- Namibia has delayed plans to sell green bonds to fund renewable energy and hydrogen projects due to setbacks with a European Union initiative set up to help developing markets with issuances. 

The EU started its Global Green Bond Initiative last year as the continent seeks to finance its energy transition. 

While Namibia’s Environmental Investment Fund has prepared for the initiative, the country hasn’t finalized its timeline for issuing its own sovereign green bonds due to delays in the financial close of the EU’s GGBI, Finance Minister Iipumbu Shiimi said in emailed responses to questions Wednesday. 

“This delay has affected the technical support and capacity-building processes required for the planned green-bond office at EIF, which would enhance readiness for larger-scale issuances,” Shiimi said.

The mineral-rich southern African nation is positioning itself as a leader in production of green hydrogen, which projects generate by splitting water using electricity from renewable power plants. Critics of the technology say it’s a commercial illusion, but its political and corporate backers believe it may be the answer to cleaner energy supplies for shipping and heavy industry. 

Despite the setbacks, Namibia remains committed to leveraging the partnership, Shiimi said.

The EIF still plans to establish a green bond office in Namibia with technical support from the GGBI, and list the debt on the Namibian and Johannesburg stock exchanges to attract local and international investors, Shiimi said.

The government has yet to finalize the specific amount it intends to raise, he said. 

“Namibia remains vigilant about aligning its approach with emerging trends in sustainable finance to ensure the bonds attract the right mix of local and international investors,” Shiimi said.

(Updates with more comments from finance minister in third paragraph.)

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