JSE joins green capital movement, first bond listing a year away
The Jamaica Stock Exchange, JSE, is adding green bonds to its trading platform, but the first listing is at least a year away.
JSE Group is working with the Green Climate Fund, GCF, to develop green bond listing standards and guidelines; after which they will school the professional groupings that usual participate in the structuring of market transactions, on the capacity and other requirements for securities to enter the JSE green market.
JSE’s interest in developing its platform for the trading of climate-friendly securities dates back to 2019 when Managing Director Marlene Street Forrest was invited to speak at the United Nations Climate Conference.
Discussions on the initiative developed between Jamaica’s Climate Change Division in the Ministry of Housing, Urban Renewal, Environment and Climate Change and the government of Dominica, which, together with the JSE, approached the South Korea-based GCF to support the market initiative.
JSE announced plans for the green bond platform on Wednesday, through which market investors will be able to transact in securities that back energy efficiency, clean transportation, sustainable agriculture, forestry and fisheries, and green water infrastructure.
The stock exchange did not name any company or entity that it might be in active discussions with for the expected listing next year. Eligibility for listing will be “no different from typical bonds,” JSE Group Business Development Manager Andre Gooden said at the launch of the project.
In addition to technical support, GCF is also providing funding for the initiative, but the amount was not disclosed.
Although small contributors to greenhouse gas emission globally, the Caribbean region often faces the worst consequences of climate change as victims of increasingly aggressive storms and other natural disasters, as well as sand erosion and depleted coral reefs that impact tourism and marine life.
Jamaica, which is a signatory to the Paris Agreement on climate action, is targeting a 60 per cent reduction in greenhouse gas emissions by 2030.
Dominica, which is also a signatory to the Paris accord, is in the process of developing a geothermal energy market and was a participant in the launch of the JSE’s green bond project.
The Green Climate Fund has provided grant financing to both Jamaica and Dominica on their green initiatives, with the roll-out of Dominica’s programme still to come.
“Dominica has six geothermal reservoirs from which an attractive portfolio of world-class assets can be developed using upstream and downstream green industrial activity,” said Gloria Josephs, the permanent secretary for Dominica’s Ministry of Economic Affairs, Planning, Resilience, Sustainable Development, Telecommunication and Broadcasting, at the JSE launch which was held online on Wednesday.
The tiny island of 72,000 people and trading partner to Jamaica under the Caricom bloc is currently engaged in a series of preparatory activities, which include additional geothermal resource mapping, feasibility studies, capacity-building and bilateral agreements.
“In engaging Jamaica collaboratively, we are guided by the expressed commitment of our political directorate to regional integration, and we are moved to support the leadership expressed by the Jamaican Government and the JSE in acting to support the development of a regional climate finance architecture,” Josephs said.