INTERVIEW: Business and Economics Researcher Josef Kefas Sheehama on Green Bonds

In a recent discussion, Business and Economics researcher Josef Kefas Sheehama highlighted the importance of Green Bonds as a crucial financial tool for promoting sustainability in Namibia. Sheehama echoed the sentiments of the Minister of Environment, Forestry, and Tourism, who emphasized the need for private sector engagement in combating climate change.

Since 2005, many banks in Namibia have begun issuing Green Bonds to raise funds for sustainable initiatives. According to Sheehama, these bonds allow financial institutions to tap into the debt market, enabling them to finance or refinance projects that contribute to environmental sustainability. The proceeds from these bonds are directed toward green projects, providing alternative funding sources for green lending activities.

Sheehama pointed out that despite the potential for green financing, many banks in Namibia have yet to fully embrace this concept. However, the urgency of climate change has prompted a push for collaboration between the government and the private sector. He stressed that Namibia needs approximately N$94 billion to address its climate-related challenges, a sum that exceeds the government’s current financial capacity.

“This presents a unique opportunity for the financial sector,” Sheehama noted. By issuing Green Bonds, banks can play a pivotal role in funding projects that not only promote environmental sustainability but also generate economic value in an ethical manner. This, in turn, enhances the socio-economic conditions within local communities.

Furthermore, the expert highlighted that many commercial banks are actively encouraging clients to incorporate sustainable practices into their home-building projects. For instance, clients are urged to consider solar energy systems as part of their home loans. This initiative aligns with the broader goals of the government to combat climate change and reduce carbon emissions.

Key renewable energy sources, such as solar, wind, and hydroelectric power, were also emphasized in Sheehama’s remarks. He stressed the importance of Namibia’s contribution to global efforts aimed at limiting global warming to 1.5 degrees Celsius. By participating in green financing, Namibia not only positions itself favorably in the international community but also enhances the reputation of companies involved in Green Bond issuance.

Sheehama concluded that Green Bonds offer a pathway to sustainable development that benefits both the economy and the environment. The financial incentives associated with these bonds, such as prime-less loans over extended periods, make them an attractive option for businesses and individuals alike. He believes that by embracing this model, Namibia can foster a culture of sustainability that positively impacts the community and elevates the nation’s standing on the global stage.

In summary, Josef Kefas Sheehama’s insights underscore the vital role of Green Bonds in financing sustainable development initiatives in Namibia. By fostering collaboration between the government and the private sector, Namibia can address its pressing climate challenges while creating economic opportunities for its citizens.