A report from the World Bank paper estimates that, globally, up to 132 million people will be pushed into extreme poverty by climate change by 2030.
In Ghana, the just released Ghana Country Climate and Development Report estimates that at least one million more Ghanaians could fall into poverty due to climate shocks, if urgent climate actions were not taken.
The report highlighted that incomes could reduce by up to 40 per cent for poor households by 2050 due to climate shocks.
Speaking at the launch of Rules for Green Bonds Rules by the Ghana Stock Exchange (GSE), the Regional Industry Director for Financial Institutions Group, Africa of the International Finance Corporation (IFC), Aliou Maiga, said while these numbers were concerning, it could be halved, if the whole world acted collectively.
He said this would require collective action and financing that prioritises greener and more sustainable development.
He noted that climate financing not only had an important development imperative, but also a significant market opportunity.
He said an IFC study showed that sub-saharan Africa needed US783 billion investment in climate finance by 2030.
Opportunity for growth
He said green finance presented the single largest growth opportunity for investors in emerging markets, noting that financial institutions could grow the share of their green lending portfolio from seven per cent to 30 per cent by 2030, increasing profitability and gaining market share.
“Green banking could enable outperformance by successful banks – not just by better managing environmental risks, but by being at the forefront of new business related to climate lending,” he stated.
He, therefore, commended the GSE for showing leadership in green and sustainability finance through the launch of the green bonds rules.
“IFC is committed to working with Ghana’s stakeholders to facilitate investments that reduce greenhouse gas emissions and support climate change adaptation,” he stated.
Also at the launch, the Director General of the Securities and Exchange Commission, Rev. Daniel Ogbarmey Tetteh, said investing in green and sustainable future was both well timed and opportune.
He said sustainability was a broader topic that hinged on social, human, economic and environmental pillars, none of which could be ignored.
“It is the most pressing challenge of our time for many business leaders. However, there is evidence of a correlation between the long-term success of a business and sustainability.
“Investors across the world are demanding opportunities to invest in companies or investments with strong Environmental, Social and Governance (ESG) markets,” he stated.
For his part, the outgoing Managing Director of GSE, Ekow Afedzie, said sustainable bonds had gained traction globally due to the enormous benefits they brought to the environment and society at large.
He said the GSE had been very committed to sustainability initiatives over the past years, culminating in its recent admission to the UN Sustainable Exchanges in July.
He noted that the launch of ESG Disclosure Manual Guidelines in November this year was also another testament to its commitment to this sustainability journey.
“The launching of green and sustainable bond rules today is another milestone on our sustainability journey. Listed companies in Ghana now can tap into these fast-growing bond investment products to raise capital that can be used in supporting ESG initiatives,” he noted.
In a goodwill message, the Senior Financial Markets Specialist at Financial Sector Deepening, Africa (FSD), Victor Nkiiri, said “at FSD Africa, we see the development of capital markets to an end to increase income and job creation, access to basic services and building of sustainable futures”.
He said deep liquid markets were fundamental to economic growth because they helped channel longer-term domestic savings of an economy into the most productive use.
– The Green Bonds Rules will guide the listing and trading of green and sustainable bonds on the local bourse.
– Green bonds are bonds that support new or existing projects to generate climate or other environmental benefits that conform to green
guidelines and standards.
– The first green bond was issued in 2007 by the European Investment Bank under the label Climate Awareness Bond.