Igor Shuvalov Meets with WHO Regional Director for Europe Hans Kluge
VEB.RF’s Chairman Igor Shuvalov has met with WHO Regional Director for Europe Hans Henri Kluge in Moscow, on VEB.RF’s premises. Mr Kluge is making a working visit to Russia.
Mr. Kluge thanked Igor Shuvalov for active involvement in work at the recently founded Pan-European Commission on Health and Sustainable Development. The inaugural meeting of the Commission took place in August 2020 bringing together reputable policy makers, community leaders and scientists, including former heads of state and prime ministers, to make recommendations for recovering and upgrading health and social care systems in the WHO European Region following the impact of the COVID-19 pandemic.
“In our opinion, the Commission and the WHO Regional Office for Europe should focus on developing a new model for efficient healthcare based on the mechanisms of public-private partnership combining the capabilities of the government and business, on developing innovation in healthcare, and enhanced application of digital medical services providing accessible frontline medicine for the population. In the context of the pandemic, our European colleagues may be interested in telemedicine based on digital technologies, which has allowed many people to gain access to the best medical services while staying home and avoiding the risk of contamination,” VEB.RF Chairman said.
First Green Bonds Are Verified Pursuant to National Methodology Developed by VEB.RF
Russian Railways has plans to issue bonds intended for financing sustainability projects and already acknowledged by Expert RA rating agency as meeting the criteria of both the ICMA international methodology and the Russian national methodology developed by VEB.RF. VEB.RF’s Green Finance Committee has officially confirmed Expert-RA’s opinion on the bonds’ compliance with VEB.RF’s recommended guidelines on green financing. This is the first case of verifying a financial instrument pursuant to a new methodology co-developed by VEB.RF, the Bank of Russia, the Ministry of Economic Development and other Russian ministries and agencies, and the expert and business communities. We would like to remind you that the methodology is available on VEB.RF’s official website at VEB.RF, section Sustainable Development.
Experts from VEB.RF’s Green Finance Committee together with Expert-RA made a thorough examination of the bonds’ compliance with the criteria specified in the methodology. “The possibility to verify the bonds was used by us for testing the methodology, - VEB.RF’s Deputy Chairman and Chairman of Green Finance Committee Aleksei Miroshnichenko said. “It was particularly important for us to ensure that the bonds satisfied the market and experts, therefore we selected a company having considerable experience of issuing similar financial instruments in Western markets.”
According to Expert-RA’s report, Russian Railways will issue perpetual bonds “to finance green projects and refinance the costs of green projects meeting the major criteria of approved Environmental Strategy Until 2020 and for the Period till 2030”. The report states that the issuer fully satisfied the requirements for the project’s transparency, proper control over the yield on bonds, disclosure of information and other project features. That is why on 17 September 2020 Russian Railways published the Concept for Financing Sustainability Projects on its website.
Modern railways are one of the most environmentally friendly modes of transport. Projects of this kind are included in almost all domestic and international classifications. However, the offer of such green bonds is limited thus far: the transport sector has accounted for only about 5% in circulating green bonds globally. Therefore, Russian Railways’ bond issue should arouse considerable interest for investors wishing to invest in the transport sector and taking into account the ESG criteria.
Russian Railways is planning to invest the bond revenue in investment projects such as the purchase of advanced electric locomotives, Lastochka electric trains, Sapsan high-speed trains, construction of the Moscow Central Ring and Moscow Central Diameters, as well as electrification of important railway branches. Thus, the projects financed through funds raised will allow Russian Railways to achieve environmental goals under the Long-term Development Programme until 2025, which are specified in the Concept for Financing Sustainability Projects and include the reduction of: hazardous air pollutants from stationary and mobile pollution sources by 18%, greenhouse gas emissions by 4.5%, aquatic resources consumed by 20%, and disposal in streams by 18%.
VEB.RF, as a developer of the national green finance standard, expects to get enhanced government and market support for such instruments. “Obviously, to make the instrument more popular, we should provide combined stimuli to issuers and investors. It is logical that ministries and agencies could offer tax or regulatory stimuli to investors that intend to buy such bonds. This will arouse increasing interest of different players in the instrument,” Aleksey Miroshnichenko said. He also added that VEB.RF intends to improve the project assessment methodology in close cooperation with all stakeholders.