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Berlin announces plans to issue sustainability bonds
Berlin has announced plans to issue “sustainability bonds” to finance social and environmental projects.
City authorities headed by Mayor of Berlin Franziska Giffey pointed out that investors will be able to invest in projects “that create special social or ecological added value.”
Berlin is the second German state, after North Rhine-Westphalia, to issue such bonds.
City authorities plan to issue EUR 750 million worth of bonds in the first round, noting that sustainability bonds are to be issued biennially.
To be financed through the bonds scheme, projects have to meet social and environmental criteria, with approximately three quarters of the money to go towards social projects and the remainder towards environmental ones.
Berlin’s Senator for Finance Daniel Wesener pointed out “it’s not just about what we finance, but how we finance it.”
City authorities noted that consumers can invest in the bonds, with a minimum purchase of EUR 1,000.
Environmental projects financed through bonds include conversion of the public transport fleet to electric and reforestation efforts, while social projects include free school lunches and support for young families.
According to Berlin’s plans, 36 projects are to be financed through the bonds scheme, focusing on gender equality, education and climate protection.
(Photo credit: Raja Sen / Unsplash)
