By Hadeel Al Sayegh and Yousef Saba
(Reuters) -Saudi Arabia’s sovereign wealth fund has hired banks to manage the sale of its first euro-denominated green bond, according to a source and a document from one of the arranging banks seen by Reuters.
The Public Investment Fund and other state-linked firms are increasingly turning to the dollar and euro bond markets to fill funding gaps and sustain Saudi Arabia’s multibillion-dollar megaprojects while aiming for net-zero carbon emissions by 2060.
PIF, which manages nearly $1 trillion in assets, has mandated Crédit Agricole CIB, JP Morgan and Societe Generale to organise investor calls starting on Monday, the document showed.
The fund did not immediately respond to a request for comment.
PIF entered the green-debt market in 2022 and has since issued several U.S. dollar-denominated bonds under its Green Finance Framework, published on its website that same year.
According to the framework, proceeds can be allocated to renewable energy, clean transport and sustainable infrastructure projects, including those undertaken by PIF subsidiaries that align with Saudi Arabia’s Vision 2030 program.
The 2060 net-zero goal was announced by Crown Prince Mohammed bin Salman in 2021, as Saudi Arabia steps up efforts to expand sustainable financing and attract green investment.
The potential bond sale comes after Saudi Arabia and other Gulf countries lowered interest rates last month, following the U.S. Federal Reserve’s first cut this year.
Saudi issuers accounted for 18.9% of the $250 billion in emerging-market dollar debt issued in the first half of this year, Fitch said in August. The government also raised $5.5 billion via a sukuk sale in September while PIF sold a heavily subscribed $2 billion 10-year bond.
NEOM, PIF’s flagship desert mega-city project, aims to run entirely on renewable energy, while its Oxagon and The Line developments emphasise green design, zero-carbon mobility and conservation of natural habitats.
(Reporting by Md Manzer Hussain; Editing by Kirsten Donovan)
