by Ronald Njoroge
NAIROBI, March 20 (Xinhua) -- The World Bank's private sector arm, the International Finance Corporation (IFC), on Monday signed a Memorandum of Understanding (MOU) with the Kenya Bankers Association (KBA) and Nairobi Securities Exchange (NSE) to spur the development of green bonds in the East African nation through individual bank issuances.
Under the new partnership, IFC will provide KBA member banks with technical support in green finance in conjunction with other climate finance initiatives undertaken by IFC in other markets, including South Africa and Turkey.
KBA CEO Habil Olaka said in a statement that there is a great opportunity for banks to attract funding aligned to climate change issues and Kenyan banks welcome the technical assistance and advisory support from IFC towards this end.
Olaka said the sectors that require green finance include agriculture and agribusiness, manufacturing, building and construction, transportation, infrastructure and energy.
"There is no shortage of investment opportunity and we therefore hope that banks will consider how they can tap this investment opportunity towards building their portfolios while also contributing to Kenya's sustainable development," he said.
NSE CEO Geoffrey Odundo said the agreement with IFC will enable Kenyan banks to tap the capital markets to attract new investors with dedicated allocations aligned to climate change mitigation and adaptation, as well as the Sustainable Development Goals.
"The world continues to aspire for green and inclusive growth and we therefore urge our listed and non-listed entities to embrace the green bond market as an innovative and alternative way of raising finance from both domestic and external sources for sustainability-driven investments," he said.