IFC invests $150 million in Việt Nam's first local currency sustainability bonds to drive green growth

Tuesday, Sep 19, 2023 16:08

BIM Land's InterContinental Phu Quoc Long Beach Resort. IFC is investing more than VNĐ2.3 trillion ($100 million) for BIM Land's expansion and low-carbon growth model. — Photo courtesy of bimland.com

Amidst a green shift in the local business landscape, the International Finance Corporation (IFC) is investing approximately VNĐ3.5 trillion (US$150 million) in Việt Nam's first-ever local currency sustainability-linked bonds (SLBs) issued by BIM Land Joint Stock Company and its subsidiary, Thanh Xuân Joint Stock Company. These bonds aim to facilitate business expansion, job creation, and the promotion of a low-carbon growth model.

IFC's investment is divided into two parts, including more than VNĐ2.3 trillion ($100 million) for BIM Land and nearly VNĐ1.2 trillion ($50 million) for Thanh Xuân Joint Stock Company, both of which are under the BIM Group umbrella. These funds will fuel the Thanh Xuân valley project, an eco-friendly residential community alongside an InterContinental-branded hotel complex and other amenities in Vĩnh Phúc Province. Furthermore, IFC's financing will support water and energy savings initiatives in two BIM Land hotels on Phú Quốc Island.

These SLBs incentivise improved water conservation and energy efficiency across three hospitality assets, potentially reducing CO2 emissions by 4,000 metric tonnes annually. The move aligns with BIM Land's ambition to be a leading Asian property developer with a focus on sustainability.

IFC has collaborated with BIM Land to create a sustainability-linked financing framework with tailoured performance targets. This initiative is pivotal in driving Việt Nam's green transition and attracting responsible investments.

“Private capital is key to Việt Nam’s green transition. The issuance of the first local currency SLBs in the country will signal the viability of innovative green financing instruments as an alternative source of capital for climate-smart projects," said Thomas Jacobs, IFC Country Manager for Việt Nam, Cambodia, and Lao PDR.

“IFC’s funding will also encourage developers to align their interests with responsible investment and to mobilise funding from green capital markets, paving the way for sustainable tourism sector.”

In line with Việt Nam's goals of achieving high-income status by 2045 and net-zero emissions by 2050, IFC's engagements in the country emphasise climate and sustainability. To date, IFC has committed over $900 million to climate-related projects and nearly $1.9 billion in fiscal year 2023 to support local companies in overcoming challenges, including those posed by the COVID-19 pandemic. — VNS

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