ISLAMABAD: Natural Performance Bonds (NPBs) has offered finances for Pakistan’s climate change initiatives,
WealthPk reported on Friday.
The Ministry of Finance said Pakistan can benefit from the issuance of Nature Performance Bonds (NPBs) which finance its green or climate change initiatives.
According to an official document of the ministry, the government has not undertaken any NPB transaction to date. However, in order to explore these bonds, the Ministry of Climate Change has signed a joint statement with the United Nations Development Programme (UNDP) and bilateral partners – including the United Kingdom (UK), Germany, and Canada – under which technical assistance will be provided to the government for such initiatives.
“Pakistan being vulnerable to climate change can benefit through issuances of the NPBs, as the proceeds can be utilized for financing green or climate change initiatives of the government”, it said, adding the NPBs allow access to investors which prefer green investments targeting climate change or biodiversity programs.
It is pertinent to mention that Pakistan had released a joint statement with Canada, Britain, Germany and the UNDP to initiate the launch of NPBs in order to avail itself of debt relief and development funding to promote sustainable development.
As part of its climate-resilient growth initiatives, Pakistan is endeavouring to establish a NPB with a defined set of ambitious ecosystem restoration targets and to get concessionary financing for development projects.
The bond will be developed by a consortium of financial advisers consistent with market conditions, thereby creating an enabling environment for private sector finance as well as non-traditional development partners to play their role in sustainable development, WealthPk reported.
“We commend Pakistan’s leadership for all these interventions. We welcome and endorse the Government of Pakistan’s ongoing efforts to create the world’s first Nature Performance Bond (NPB) with a defined set of ambitious ecosystem restoration targets. Pakistan has already conducted a preliminary identification of nature restoration priorities, targets, and performance indicators”, the joint statement added.
The Government of Pakistan and selected development partners agreed to engage in a dialogue for launching this pioneering initiative to enable a green recovery and accelerate natural capital restoration action in the country.
It was decided that the size and term sheet of the bond will be developed by a consortium of financial advisers consistent with the market conditions.
Green initiatives:
Pakistan – the world’s 5th largest country with a population of around 220 million – is responsible for less than one percent of global carbon emissions but is considered among the top 10 most climate-vulnerable nations.
Currently, the government is implementing multiple green initiatives to combat these climate change issues. Pakistan’s efforts to protect and preserve natural environment are being widely hailed and recognised nationally and internationally.
A recent statement of UNDP said Pakistan had been in the forefront of protecting and conserving environment through nature-based solutions like the Billion Tree Afforestation Project of Khyber Pakhtunkhwa (KP) province which was widely appreciated by the World Economic Forum (WEF), the Bonn Challenge and other international fora.
Similarly, the country also initiated 10 Billion Tree Tsunami project (10 BTTP) – another flagship project of the government with the overarching objective of mitigating the adverse impacts of climate change.
The project’s key components include improved forestry sector performance through a large component of afforestation and forest protection as well as better management of protected areas. -INP
