Nairobi County and CMA Agree to Form Committee for Green Bond Issuance
Nairobi County and Capital Markets Authority (CMA) have agreed on forming a committee that will guide issuance of a municipal green bond aimed at raising funds for environmental projects such as renewable energy, water conservation etc., while also committing themselves towards exploring changes in policy enabling counties borrowing above current limit of 20%.
Jan. 10, 2023 1:51PM
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A picture showing Governor Mike Sonko shaking hands with Paul Muthaura from CMA at their press conference announcing their agreement on forming a committee for issuing a municipal green bond
In a move that is set to revolutionize the way counties borrow for development projects, Nairobi County and the Capital Markets Authority (CMA) have agreed to form a committee to guide the issuance of a municipal green bond. The CMA has also committed to exploring changes in policy that would enable counties to borrow more than the current limit of 20.0% of audited annual revenues. The agreement was reached during a meeting between Governor Mike Sonko and CMA Chief Executive Paul Muthaura, who both expressed their commitment towards promoting sustainable development through innovative financing mechanisms such as green bonds. The proposed bond will be issued by Nairobi County with the aim of raising funds for environmental projects such as renewable energy, water conservation, waste management, and climate change adaptation. Speaking at the press conference following the meeting, Governor Sonko noted that this was an important step forward in addressing some of Nairobi’s most pressing challenges. He said: “This is an exciting opportunity for us to raise much-needed funds for our county’s development initiatives while also promoting sustainability in our environment. We are confident that this partnership with CMA will help us achieve our goals faster and more efficiently than ever before." Muthaura echoed Sonko’s sentiments by emphasizing how green bonds could play an important role in supporting Kenya’s transition towards greener economies and societies. He added: “We are delighted to partner with Nairobi County on this initiative which has great potential not only for them but also other counties across Kenya looking into innovative financing solutions." The two parties have agreed on forming a committee which will be responsible for guiding all aspects related to issuing the municipal green bond including setting up appropriate structures, identifying eligible projects, and establishing necessary regulations among others. The committee is expected to begin its work immediately with further details about the bond expected soon after completion of its initial tasks.