NGX, IFC champion Labelled Bond Market to unlock climate capital for Nigeria

By Chukwuma Umeorah

Nigeria is ramping up efforts to unlock private climate capital through labelled bonds, with support from the Nigerian Exchange Limited (NGX) and the International Finance Corporation (IFC).

Both institutions recently co-hosted a capacity-building workshop aimed at bridging technical and structural gaps that have limited the country’s participation in the booming global sustainable bond market. The workshop, themed “Unlocking Sustainable Capital for the Real Sector: A Deep Dive into the Labelled Bonds Issuance Process”, brought together regulators, market operators, institutional investors, and policymakers to explore pathways for increasing labelled bond issuance in Nigeria.

Labelled bonds such as green, social, blue, and sustainability-linked instruments have become vital financing tools for clean infrastructure, energy transition, and inclusive development. According to the organizers, global issuance surpassed $6.2 trillion by the end of 2024, and Nigeria is now positioning itself to tap more meaningfully into this capital stream.

“Unlocking sustainable capital is central to achieving Nigeria’s vision of a $1 trillion economy, shared prosperity, and long-term resilience,” said Jude Chiemeka, CEO of NGX, noting that the Exchange has already laid the groundwork through initiatives like its Sustainability Disclosure Guidelines, the Impact Board, and green bond listings.

Principal Country Officer at IFC, Christian Mulamula, expressed optimism about Nigeria’s potential to become a continental leader in sustainable finance. “We share an ambition for Nigeria to become a model for green and sustainable finance on the continent,” he stated, adding that IFC’s collaboration with NGX is part of a broader effort to deepen market infrastructure across Africa.

To further boost the sustainable finance agenda, the Federal Ministry of Environment recently announced the issuance of Nigeria’s largest sovereign green bond to date, N50 billion, to fund projects in renewable energy, afforestation, clean transport, and sustainable agriculture. “This issuance underscores Nigeria’s commitment to scaling private finance in line with national development goals,” said Olaitan Fajuyitan, Special Adviser and Coordinator of Sovereign Green Bonds.

Also speaking at the event, Husaini Shettima, representing the Federal Ministry of Marine and Blue Economy, described the workshop as timely and strategic for developing blue finance frameworks. “The next frontier is developing a robust blue bond framework that aligns with national priorities and global standards,” he noted.

Participants also received insights on the technical processes for issuing and listing labelled bonds through the Exchange. “Bond listings on NGX offer issuers access to a diversified investor base and enhance market transparency, key for sustainable capital mobilisation,” said Abimbola Babalola, Head of Trading and Products at NGX.