Brazil issues its first sustainable government bonds

Brazil has revealed plans to debut sustainable sovereign bonds worth US$2 billion this September, with the funds directed towards environmental and social projects.

Darío Durigan, the Executive Secretary of the Ministry of Finance, announced at a Fondo para el Clima management committee meeting.

He stated that the global community would soon observe and acquire these sustainable bonds.

Durigan emphasized that the anticipated collection from the bonds, around US$2 billion, could significantly aid in financing the Government’s Ecological Transition Plan.

In an upcoming meeting of the National Monetary Council, which comprises the Ministers of Finance and Planning and the Central Bank’s President, Durigan expects the government to approve issuing the country’s inaugural sustainable sovereign bonds.

Sources from the Ministry of Finance shared last week that the initial allocation of these bonds would primarily support the Climate Fund, overseen by Brazil’s National Bank for Economic and Social Development (BNDES).

The objective is to sponsor initiatives that genuinely cut emissions.

These bond issuances align with President Luiz Inácio Lula da Silva’s initiative to bolster Brazil’s environmental credibility.

A comprehensive ecological strategy, inclusive of a regulated carbon credit market, is part of this effort.