The Republic of Chile’s Ministry of Finance published a new sustainable bond framework, with the support of the Inter-American Development Bank. The new framework expands the county’s existing Green Bond Framework, enabling the country to issue green, social or sustainable bonds. V.E, an affiliate of Moody’s, has provided a Second Party Opinion on the new framework.
The framework outlines eligible social and environmental categories that may be financed by the country’s green, social and sustainable bonds. The categories included under the prior Green Bond Framework included clean transportation, energy efficiency, renewable energy, living natural resources, land use and marine protected areas, water management, and green buildings. The new framework extends the range of sustainable finance eligible projects to nine social categories, including support for the elderly or people with special needs from vulnerable sectors, support for low-income families, support for human rights victims, community support through job creation, access to basic housing, access to education, food security, access to essential health services, and programmes designed to prevent and/or alleviate unemployment derived from socioeconomic crises.
V.E announced today that it has provided a Second Party Opinion (SPO) on the sustainability credentials and management of the contemplated sustainable bonds to be issued by Chile. In its opinion, V.E stated that the Framework is aligned with the four core components of ICMA’s Green Bond Principles (2018), Social Bond Principles (2020), and the Sustainability Bond Guidelines (2018), and adopts best market practices identified by ratings provider. Additionally, according to V.E, the categories specified under the framework are likely to contribute to 14 of the 17 UN Sustainable Development Goals (SDGs).