Saudi fund PIF to issue green debt soon, governor says
DUBAI, Sept. 22 (Reuters) – Saudi Arabia’s sovereign wealth fund plans to announce its first green debt deal soon, with sustainability-linked borrowings, the governor of the Public Investment Fund said in a virtual event.
“We will be the first sovereign wealth fund in the world to announce this green issue,” Governor Yasir al-Rumayyan said on Tuesday at an event held on the sidelines of the United Nations General Assembly.
In July, Reuters reported that the PIF sent banks a request for proposals to put in place a framework for environmental, social and governance (ESG) issues. This month, PIF engaged banks to be part of its ESG panel for its medium-term fundraising strategy, IFR News reported.
Rumayyan said PIF is working with BlackRock on the ESG framework.
“We are working with many partners around the world, nationally and internationally, to have better ESG compliance (in) all the things we do,” said Rumayyan.
Establishing PIF’s ESG framework could lead to a first multi-billion dollar sustainability bond sale as early as this year, banking sources told Reuters.
Saudi Arabia has seen a resurgence of interest in ESG-related initiatives amid growing awareness among global investors of ESG risks.
PIF signed a $ 15 billion loan with a large group of banks in March, followed by a $ 10 billion loan in 2019 that was repaid last year and an $ 11 billion facility. in 2018.
One of the companies owned by PIF, the Red Sea Development Company, which is building a new resort in the kingdom, secured a $ 3.8 billion green loan earlier this year for new hotels powered by renewable energy. .
Saudi Arabia will announce its “Green Initiative” next month, followed by the “Middle East Initiative,” which includes the planting of 50 billion trees, Rumayyan said.
“We have a long-term vision. We don’t want to use all of our resources overnight,” he said.
(Reporting by Yousef Saba; Editing by Edmund Blair)