Green finance is a worldwide affair. While the traditional money centers of New York and London play critical roles in the burgeoning renewable economy, investment is increasingly originating farther afield, nearer to places in need of upgraded energy infrastructure. That means countries from South Africa to Morocco to Kazakhstan are betting they can compete as new hubs of climate-focused funding.
Standard Bank’s South African Unit, for example, this week sold the continent’s biggest green bond yet. Africa is expected to attract significant green investment as it builds up solar and wind power, exploiting an opportunity to leapfrog outdated fossil fuel energy systems. Aspiring green finance hubs are already rising in such places as Casablanca, Lagos and Johannesburg to fund this tectonic shift.
Tiny Luxembourg, which launched the world’s first green securities exchange in 2016, has the largest market share of listed green bonds, while Astana, in Kazakhstan, is trying to brand itself as the center of Central Asia’s green finance market.
“Cities all over the world have expanded their thinking, policy and investment in the energy space into efficiency, renewables and smarter infrastructure,” says Kristin Barbato, co-founder of Dynamo Energy Hub, which is building networks and workspaces in cities around the world for cleantech entrepreneurs.
This isn’t to say international banks are standing on the sidelines. France’s Credit Agricole surpassed Spain’s Banco Santander last month to become the top underwriter of green bonds so far this year. While France has dominated green bonds in 2020, China was the dominant issuer last year. Hong Kong’s Financial Services Development Council meanwhile has been working since 2016 to establish that city as a regional green finance hub, saying “if it does not seize this opportunity, others will do so.” They already are. Read More…
