The European Bank for Reconstruction and Development (EBRD) is backing Morocco’s capital markets by investing MAD400 million ($43.3 million) in a local municipal bond issuance.
The MAD1 billion bond, issued domestically in local currency by the Casablanca-Settat region, will drive investments under its 2022-27 regional development plan.
The EBRD investment will support the Casablanca-Settat region’s diversification of funding sources by tapping the debt capital market, the development bank said in a statement.
The subscription will also trigger investment, allowing the Casablanca-Settat region to join EBRD Green Cities – the bank’s flagship urban development programme which helps cities to address their climate and environmental challenges.
As part of the deal the region will develop a green city action plan and a pilot mobility planning initiative to foster greener, smarter and more inclusive transport options.
EBRD’s investment will be complemented by a $2.4 million technical cooperation package, including funding from the Netherlands for the development of the regional green city plan.
The Casablanca-Settat region is the second municipal bond issuance in Morocco and the first by a regional authority.
The region is one of Morocco’s economic centres, accounting for more than 31 percent of national GDP and a large share of the country’s industrial activity, exports and investment.
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EBRD, which has been investing in Morocco since 2012, has committed more than €6 billion ($7 billion) in the country, supporting the private sector, the green transition and sustainable infrastructure.
In September Morocco, Egypt and Jordan were among 13 countries that will benefit from a $634 million green financing initiative launched by the EBRD.
Since 2017, the EBRD and the Green Climate Fund have mobilised more than $5.2 billion in climate finance on three continents.