Cyprus preparing eco bonds

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Cyprus’ green bonds pave the way for sustainable financing, thus allowing the Republic to have access to additional sources of financing beyond traditional methods, said Finance Minister Constantinos Petrides.

In a written statement on preparing the framework for issuing a Green/Social/Sustainable Bond (Project Mouflon), he said the Cabinet was informed today about the project’s progress.

Nicosia is preparing the necessary framework for sustainable financing and the planned issuance of the first Sustainability Bond of the Republic.

He points out that the Republic can use the framework to issue sustainable bonds and loans for financing government initiatives that cover a wide range of green and social projects.

Petrides said the Sustainability Financing Framework defines environmental and social spending sectors that can be financed through the issuance of sustainable bonds under international standards.

The framework includes government projects, plans, and expenses that could be financed by issuing a sustainable bond.

The minister noted that the international ESG (Environmental – Social – Governance) bond market has a growing dynamic, adding that bond issuance in 2022 amounted to almost €1 trillion.

An increasing number of European Union member states are issuing or preparing to issue such bonds.

“The participation of the Republic of Cyprus in this market is expected to offer significant advantages both in terms of liquidity and evaluation by international rating agencies”.

Petrides underlines that the upcoming finalisation of the framework paves the way for sustainable financing, allowing Cyprus access to additional sources beyond the traditional ones, thus demonstrating a commitment to promoting environmental and social actions through the state budget.