From Adanna Nnamani, Abuja
Nigeria’s green bond stock fell to N32.83 billion in 2024, a sharp decline from N47.83 billion recorded a year earlier, as the country struggles to mobilise adequate climate finance to tackle worsening environmental challenges.
According to the State of Enterprise (SOE) 2025 report, the drop followed the redemption of Access Bank’s green bond, with no fresh issuances from either the federal government or sub-national entities. The planned $250 million sovereign green bond did not materialise, while Gombe State’s proposed N15 billion issuance was also stalled.
This comes as the African Development Bank (AfDB) estimates that Nigeria requires $22.5 billion annually to meet its climate goals.
However, total climate finance attracted by the country between 2021 and 2022 was just $2.5 billion, leaving a massive shortfall. Out of this, $1.2 billion was committed to mitigation projects such as solar energy, and $740 million to adaptation efforts like flood control.
Despite global growth in sustainable finance rising to $3.56 trillion in assets under management in 2024, a 4.8 per cent increase, Nigeria’s share remains low, representing just 6.8 per cent of global AUM. The country also dropped nine places in the 2025 Climate Change Performance Index (CCPI), ranking 26th out of 67 countries assessed, with weak scores in climate policy and renewable energy deployment.
The report warned that rising desertification, urbanisation, flooding, and fossil fuel dependence continue to threaten Nigeria’s sustainable development outlook. It stressed that access to green capital must be urgently scaled up to meet the country’s Nationally Determined Contributions (NDCs), which aim to cut emissions by up to 47 per cent by 2030, conditional on international support.
To close the funding gap, the report highlighted major commitments secured in 2024, including €245 million ($254.76 million) from the China Development Bank for the Kano-Kaduna railway project, which is expected to promote low-carbon transport.
Also secured was $2.2 billion from the African Development Bank for Phase II of Nigeria’s Special Agro-Industrial Processing Zones (SAPZ), and $500 million from the World Bank for the Sustainable Power and Irrigation for Nigeria (SPIN) project.
Meanwhile, Environmental, Social, and Governance (ESG)-focused infrastructure funds operating in Nigeria grew their investment portfolio from N110.2 billion in 2023 to N125.7 billion in 2024.
The funds include the Africa Infra Plus Fund (AIPF I), the Nigeria Infrastructure Debt Fund (NIDF), and the AVA Infrastructure Fund.
The report also noted the planned launch of the National Credit Guarantee Company (NCGC) by the end of the second quarter of 2025. The scheme is expected to improve access to credit for businesses and underserved groups, including women and youth, thereby supporting inclusive growth.
To guide climate action, the Federal Government has developed a Long-Term Low-Emission Development Strategy (LT-LEDS) and launched the NDC Implementation Framework, which outlines targets across key sectors such as agriculture, energy, transport and waste.
The report called for urgent reforms to boost ESG investment, including integrating ESG into school curriculums, appointing ESG experts to company boards, encouraging pension funds to support green projects, and expanding carbon credit initiatives.
It noted that Nigeria’s financial and professional services sector must play a central role in attracting green investment, reducing climate vulnerability and delivering inclusive growth.
“Sustainable finance plays a critical role in advancing social, environmental, and economic outcomes aligned with the Sustainable Development Goals (SDGs). Like many other countries on the continent, Nigeria faces significant environmental, social, and economic challenges,” it stated.
Meanwhile, to revive green capital mobilisation, the federal government successfully issued a N50 billion Series III Sovereign Green Bond in June 2025, the first of such issuance since 2019.
The funds are expected to support environmentally sustainable projects, including renewable energy, clean transportation, sustainable water management, and irrigation infrastructure. This comes after a year-long pause in sovereign green bond activity in 2024 and signals a renewed push toward financing Nigeria’s climate commitments.
According to the Debt Management Office (DMO), over 95 per cent of the proceeds from the 2019 green bond were fully utilised by March 2025, reflecting improved project execution and growing investor confidence in the country’s green finance framework.