Following the successful launch of the Financial Centre for Sustainability (“FC4S”) Lagos, an initiative set on inspiring a greener Nigeria through sustainability principles, in collaboration with market stakeholders, a Declaration was co-signed by the Executive Governor, Lagos State, Mr. Babajide Sanwo-Olu and the Chairman, FC4S Lagos, Mr. Bola Onadele. Koko. This Declaration, a crucial step towards operationalising FC4S Lagos, conveys the commitment of the Lagos State Government and FC4S Lagos, as well as other key stakeholders, to advance green and sustainable finance in the Nigerian financial markets, in line with the United Nations 2030 Agenda for Sustainable Development and the Paris Agreement.

To furthersupport the entrenchment of sustainable finance in the Nigerian financial markets, FC4S Lagos, in partnership with the implementing partners of the Nigeria Green Bond Market Development Programme (“NGBMDP”) – FMDQ Group (“FMDQ”), Climate Bonds Initiative (“CBI”) UK, and Financial Sector Deepening (“FSD”) Africa – organised a Capacity Building Roundtable Webinar (“Roundtable”) for the Executive Council of Lagos State Government, themed “The Role of Sustainable Finance Instruments in Driving Economic Development” on Wednesday, August 5, 2020.

The closed Roundtable, which brought together members of the Lagos State Executive Council, including Commissioners, Special Advisers and Permanent Secretaries of Lagos State Ministries, Departments and Agencies, was delivered as part of the advocacy efforts of FC4S Lagos in driving the entrenchment of Sustainable Development Goals (“SDGs”) in institutions at the subnational and sovereign level in Nigeria. The Roundtable highlighted the sustainable finance opportunities and dimensioned how the State Government can leverage the debt capital markets to finance its huge infrastructure projects. Lagos State, which has continued to experience an exponential growth in population due to rural-urban migration amongst other factors, remains limited by land mass and therefore, continues to seek innovative ways to address sustainable development and infrastructure growth in the State. This has become more pertinent as the State seeks to flatten the curve of the global COVID-19 pandemic for which it is unsurprisingly the epicenter of the nation.

Mr. Bola Onadele. Koko, Chief Executive Officer, FMDQ Group and Chairman, FC4S Lagos, during his opening address stated “finance plays a pivotal role in attaining the United Nations 2030 SDGs, especially through the creation of alternative sources of investment, mitigation of risks and the transversal effects of ethical investments”. He further stated that “through the issuance of sustainable finance instruments, the Lagos State Government would be able to fund projects that attract the right pools of foreign investors, as it strives towards the actualisation of the “THEMES” Agenda which cuts across six (6) strategic development focus areas namely; Traffic Management and Transportation, Health and Environment, Education and Technology, Entertainment and Tourism as well as Security and Governance, making Lagos a 21st Century Economy”. He reiterated that “FC4S Lagos, in collaboration with the implementing partners of the NGBMDP; FMDQ, FSD Africa and CBI UK, will continue to support the Lagos State Government to expand its capital pool by leveraging on private sector investments through the wide array of available sustainable finance instruments within the debt capital markets”.

Speaking about the success of the roundtable, the Executive Governor of Lagos State, Mr. Babajide SanwoOlu, stated, “having deliberated about the plethora of social challenges targeted by the government’s THEMES Agenda, it was also a delight to discuss the benefits of innovative sustainable finance instruments. Indeed, the interest, readiness, and commitment of our partners are a testament to the beginning of a meaningful and sustainable collaboration towards ending our social challenges. As a government, we look forward to continued collaboration with FC4S Lagos, FMDQ, CBI UK, FSD Africa and other international and domestic private sector stakeholders, in ensuring that these development opportunities are realised for the sustainable development of Lagos State”. Supporting the Executive Governor’s view, Dr. Obafemi Hamzat, Deputy Governor of Lagos State, averred that “one major point of interest is that sustainable financing instruments do not just look at the traditional areas requiring financing – such as road and rail infrastructure, rather, they include funding options for ‘the biggest businesses for humanity’, which are education and healthcare”.

Whilst speaking on the benefits of promoting green bond issuances in the State, Mr. Victor Nkiri, Senior Financial Markets Specialist, FSD Africa, stated that “the NGBMDP is designed with an incentivising objective to neutralise costs related to external reviews, establishing a ‘level-playing field’ for green bond issuers”. The programme catalyses investments in renewable solutions, presenting a novel method for African nations to address their SDG targets. He further reiterated that “green bonds are a long-term solution to a present problem and far-reaching future risk that needs to be addressed immediately”. According to Ms. Justine Leigh-Bell, Deputy Chief Executive Officer & Director, Market Development, CBI UK, “it is clear that investors globally have a huge appetite for sustainability-linked bonds. The COVID-19 pandemic has highlighted the need for diversification of investment portfolios to recognise climatic risks amongst others”. She further stated “CBI is pleased to have worked with itslocal partners, such as FMDQ, FC4S, Lagos and FSD Africa to deliver this capacity building roundtable and is looking forward to future collaborations that will not only grant Lagos State access to the vast investible pools of foreign/local funds looking for green and sustainable projects to address climate and social challenges, but will showcase the State as a trailblazer in sustainability in Nigeria and West Africa”.

Mrs. Solape Hammond, Special Adviser, Office of Sustainable Development Goals & Investment, Lagos State, in her remarks, assured that, “ Lagos State Government will leave no segment of the society behind in the effort to achieve the sustainable development of the State. As such, the State Government is open to initiatives and partnerships that will support the implementation of the seventeen (17) United Nations SDGs in Lagos and Nigeria as a whole”.

With its admission in May 2019, Lagos became the 23rd Member of the International Network of Financial Centres for Sustainability (FC4S Network), joining other international financial centres such as New York, London, Geneva, Shanghai, with a mission “To position Nigeria as a leading market in sustainability principles through investments, innovation, partnerships and capacity development”. FC4S Lagos is structured as an Incorporated Trustee with the aspiration to be independently run and self-funded, with FMDQ currently serving as the Secretariat, coordinating the activities of the financial centre and liaising with the international network towards meeting the overarching objective of promoting green and sustainable finance in Nigeria.