Saudi Arabia Government Preps Green Bond Debut - Bloomberg
Saudi Arabia’s government mandated banks for another wave of debt sales, including a debut green bond, as the kingdom ramps up a borrowing spree aimed at helping to fund the country’s vast economic diversification agenda.
The Ministry of Finance may issue euro-denominated notes as soon as tomorrow, subject to market conditions, according to a person familiar with the matter, who asked not to be identified discussing private information. The offering may include a seven-year green bond and conventional with a tenor of 12 years, the person said.
The potential offering adds to a flurry of recent borrowing activity from the kingdom, including the sale of $12 billion of sovereign bonds last month. If a green sale goes ahead, it would be the first from the central government as the world’s top oil exporter looks to cut greenhouse gas emissions by 278 million tons per year by 2030. The Saudi sovereign wealth fund known as the PIF started issuing green debt in 2022.
Proceeds from the green bond would be used to finance projects within the country’s green financial framework, according to the person familiar. That framework identifies eight types of projects eligible for funding from so-called green debt sales, including work that promotes cleaner transportation and renewable energy.
Saudi Arabia’s finance ministry mandated HSBC, JPMorgan and Societe Generale as global coordinators for the potential bond sale.
The kingdom — via the sovereign and state entities such as the PIF, which has roughly $925 billion of assets — has been one of the most prolific issuers among emerging markets over the past year. The government has said it plans to continue tapping debt markets in 2025 as it seeks to plug an expected budget deficit.
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