European Union (EU) hosts world’s largest green bond sale and raises € 12 billion


The EU has sparked massive demand for its first ‘green bonds’, raising € 12 billion

The EU sparked massive demand on Tuesday for its first “green bonds”, raising 12 billion euros ($ 14 billion) in the world’s largest sustainable debt issue, the European Commission said.

“This is the largest green bond order book ever recorded in global financial markets, and the largest green bond ever issued, not only in Europe but in the world,” the commissioner told reporters. European budget Johannes Hahn.

The money collected by the European Commission is to be returned to Member States to be spent on cleaner energy, energy efficiency and other means to achieve the EU’s carbon neutrality goal by 2050.

The so-called green bond, however, came before the EU finalized its own list of investments to be considered environmentally friendly, with countries sharply divided over the role of nuclear power.

Instead, the EU has said it adheres to the principles of the International Capital Market Association and other standards.

The EU sale “has attracted massive demand,” which bodes well for similar global green debt issuance, said Johann Ple, of AXA Investment Managers.

“This supports our view that total green bond issuance in 2021 is expected to double from 2020 to reach € 400 billion,” he said.

The 15-year debt sale was the first of the EU’s goal of raising € 250 billion in sustainable debt by 2026, which will make the European Union the largest issuer of green debt.

It represents around a third of the 800 billion euros agreed by EU member states for Europe’s pandemic recovery plan which relies on borrowing shared by the EU executive.

Plans for the EU to develop its own list of energy sources considered green and therefore suitable for sustainable financing – known as an investment taxonomy – are currently on hold.

Germany is resisting calls for nuclear power to be seen as an environmentally friendly investment, reflecting its national anti-nuclear stance.

But 10 EU member states, including France which runs largely on nuclear power, jointly backed a statement in favor of nuclear power on Sunday, stressing that it has a major role to play against global warming. climate.

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