Rwanda has launched the first sustainability-linked bond (SLB) in the East Africa Community.

Devised by the Rwanda Development Bank (BRD) with support from the World Bank, the SLB will mature in seven years and is targeting US$24.8 million, reports Africa Business Communities. It is part of a bigger plan to raise $124 million in the medium term.

According to Uzziel Ndagijimana, Rwanda’s Minister of Finance and Economic Planning it is also the first time that financing from the World Bank’s International Development Association is being used to leverage private capital. ‘We are glad the World Bank chose Rwanda to be the proof of concept for this initiative,’ Ndagijimana said earlier this month.

A notable feature of the SLB is the credit enhancement facility funded by the World Bank loan to mobilise private capital.

The issuance of the SLB will mean that BRD ‘is no longer solely reliant on international credit lines thereby expanding its resource mobilisation efforts’, said Kampeta Sayinzonga, CEO of the BRD.

The SLB will link funding with sustainability strategies as outlined in Rwanda’s Vision 2050.

17 October 2023
Image: Flickr