In recent news, Gia Lai Electricity Joint Stock Company (GEC) subsidiary Gia Lai Dien has become the first entity in Vietnam to receive the Green Finance Framework certification from the Climate Bond Initiative (CBI). This achievement signifies a commitment to sustainable development and transparency.
With this certification, Gia Lai Electricity is now able to issue green bonds in the future, paving the way for sustainable finance initiatives. The company plans to utilize these funds to finance two offshore wind power projects, Tan Phu Dong 1 and 2, with a combined capacity of 150 MW.
Green bonds, as defined by the Law on Environmental Protection 2020, are financial instruments used to mobilize capital for environmental protection initiatives. They operate similarly to conventional bonds but incorporate environmental criteria into the projects they fund. The Green Bond Principles established by the International Capital Markets Association (ICMA) and the Climate Bond Standard administered by the CBI guide their issuance.
The significance of Gia Lai Electricity’s achievement was recognized by Mr. Nguyen Quang Thuan, General Director of FiinRatings. He stated that this certification sets the stage for the company to focus on sustainable finance activities in Vietnam. Sean Kidney, General Director of the Climate Bond Initiative also highlighted this growth in sustainable finance in Vietnam with Gia Lai Dien’s certification.
Prior to Gia Lai Dien’s certification, other businesses in Vietnam such as Electricity Joint Stock Finance Company (EVN Finance) and BIDV had successfully issued green bonds in accordance with ICMA’s Green Bond Principles. These certifications demonstrate a commitment to sustainable finance and contribute to global efforts to combat climate change.
