Chile is testing the markets to issue new green and social bonds
01/21/2021 Since 1 month

The funding will be in euros and the proceeds will go to finance sustainable initiatives and social programmes.

During 2020 countries and companies placed debt with the promise that the resources collected would go to finance green, social and governance projects. ESG bonds raised a total of US$ 732 billion last year, a rise of 29% compared to 2019, according to Bloomberg NEF. “These are categories that have been growing over time, and they arise because of a greater demand from niche investors for this type of bond,” explained Andrés Pérez, coordinator of international finance at the Finance Ministry. For the same reason, the portfolio is preparing to re-issue this type of debt in the coming days. “The intention is to issue green and social bonds in euros, either at 10 years or at 20 or 30 years, so we are starting meetings with different types of investors” said Perez in PAUTA Bloomberg, of Radio Pauta.

“Chile as an issuer stands out as a leader over the years and has issued around US$6.2 billion in green bonds since 2019, and we intend to enhance this role,” he added.

The last issue by the Treasury was made in November last year in local currency. At that time, a rate of 2.5% was achieved for papers maturing in 2028 and 3.4% for the 2033 term. The aim of this issuance is to achieve more attractive conditions. Beyond the rate, it is important in the context of various dimensions that we seek to target in this type of operation and to continue diversifying the investor base.

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