Brazil's government created on Wednesday an interministerial committee to develop a framework for issuing "sustainable sovereign bonds" aiming to launch a bond later this year.
These new bonds will be "instruments of public debt backed by federal government budget allocations for sustainable development," including actions and projects related to environmental and social themes, according to the Finance Ministry.
While there is no specific date for the framework's release, the ministry expects the process to be completed in time for sustainable bonds to be issued later this year, it said in a statement.
Treasury officials have told Reuters that Brazil's first green bond will likely raise around $2 billion, possibly split into two tranches.
The framework will showcase the country's sustainability credentials to investors and establish guidelines for issuing sustainable bonds as new President Luiz Inacio Lula da Silva seeks to position Brazil as a leading player in the environmental agenda.
It will also encompass the structure and criteria to monitor fund allocation and evaluating expenditures' environmental and social impact.
Treasury Secretary Rogerio Ceron will chair the committee, which will also include representatives from the Finance Ministry's Secretariat of Economic Policy, as well as nine other ministries, including Environment and Development and Social Assistance.
"During the framework development process, the National Treasury will continue with its strategy of traditional issuance of foreign debt bonds, taking advantage of opportunities in the international market," said the Finance Ministry, following a $2.25 billion operation in April.
