Towards Net Zero: Understanding Nigeria's Green Bond Policy Framework

For the last decade, Green Bonds have been shaping global capital markets and fusing sustainability and finance discussions. Clearly, to mitigate the effects of climate change, improve ‘green’ practices and satisfactorily convert our economic vehicles to run on the principles of sustainability, nations and corporations need sufficient funding from sustainable schemes. Due to the coronavirus, we are now facing substantial fiscal challenges and consequently international aid and donations to Nigeria may be scaled back significantly. However, the need to transition towards sustainable energy, green economy and healthy environment cannot take the back seat in light of the adverse effect of climate change in the country. The problem, however, stems from the fact that Nigeria cannot afford the cost of transitioning in light of the poverty levels, lack of infrastructure and need to build a proper manufacturing and export-based economy. Against this backdrop, this paper examines the nature and potential of green bonds to create a solid transition program towards achieving the goal of ‘net zero’ while explaining Nigeria’s current policy framework on green bonds, the country’s place in the green bond market and the adaptation of global best practices. The paper concludes by suggesting new policy areas to further develop this scheme.