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Serbia issued the first green Eurobond in the amount of one billion euros

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The first green Eurobond in Serbia was issued in the amount of one billion euros with a maturity of seven years and a coupon rate of one percent, the lowest ever achieved on the international market. At the same time, with the issue of the green Eurobond, a fifteen-year Eurobond in the amount of 750 million euros was issued, with an annual coupon rate of 2.05%, according to a statement published on the website of the Ministry of Finance.
It is added that with the issue of bonds, “the Republic of Serbia is one of the few European countries that have issued green Eurobonds on the international financial market, and which are intended exclusively for financing environmentally friendly projects.”
– The high level of demand has enabled Serbia to provide favorable interest rates for both issued Eurobonds. The total demand amounted to over six billion euros by more than 200 investors, which during today’s auction enabled the reduction of the interest rate by 0.35 percentage points on green, seven-year, bonds and 0.30 percentage points on fifteen-year bonds. This was preceded by several days of talks between the delegation of the Republic of Serbia and a large number of investors from all over the world – it is emphasized in the announcement.
The delegation once again presented Serbia as a new investment destination for investors who exclusively invest in green projects, and thus diversified its investment base.
Minister of Finance Sinisa Mali pointed out that the state is committed to increasing investments in ecology and environmental protection, as well as providing the most favorable funds for green projects from new sources of financing, such as the green bond market.
– The Republic of Serbia bravely entered the international capital market and offered its green bond, worth one billion euros, although the demand was much higher. Thanks to the great interest, the interest rate on the green bond has been reduced by as much as 20% compared to the initial one, which proves the justification of the decision to issue this type of green agenda and this is another indicator of Serbia’s commitment and commitment to green projects and increasing investment in ecology. It is also an important signal for investors to strive to strengthen their capacities and invest in environmental protection – stated Mali.
He added that the green bond market has been developing rapidly in recent years with the aim of securing funding for projects that contribute to environmental sustainability in the broadest sense.
“Every year, the whole world, and Serbia is no exception, invests more and more in environmental protection, and investors have recognized that,” the minister explained.
– Funds from issued green bonds will be used to finance and refinance costs related to the construction of drinking water treatment plants and wastewater treatment plants, construction of subways and modern railways, flood protection, biodiversity conservation, pollution control and prevention, collection , waste processing and recycling, energy efficiency and renewable energy sources. These funds will be strictly controlled and cannot be used for other purposes, which clearly speaks of our commitment to ecology – stated Minister Mali.

He pointed out that, despite the pandemic, Serbia is providing funds for new investments related to the field of environmental protection.
– We are proud to be leaders in the region and beyond, and to have managed to prepare a Framework Document for the issuance of green bonds, provided a positive opinion of an independent verifier and bravely entered the international financial market. Just a few days before Serbia published the Framework Document for issuing green bonds, the European Union published its Framework Document promoting the issuance of green bonds in the amount of 250 billion euros for its projects, which once again shows that we are keeping pace with the world – said is Mali.
The green tranche was issued in accordance with the Government’s strategic plan to invest additional funds to finance projects in the areas of environmental protection and climate change mitigation. It will help to improve energy efficiency, the waste management system and to ensure the most rational use of, above all, renewable energy sources.
Most of the funds raised by the issue of the second tranche of the Eurobond will be used for what is most urgent at the moment, and that is to repay the debts that were inherited from the past, eKapija reports.

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