The European Bank for Reconstruction and Development (EBRD) is investing up to MAD 400 million (EUR 38.4 million) in Morocco’s rail sector through a MAD 2 billion (EUR 192 million) green bond issued by the Office National des Chemins de Fer du Maroc (ONCF).
Issuing the bond will partially refinance the debt from ONCF’s latest development round designed to modernise and electrify the network, acquire and upgrade electric rolling stock, address safety units and substations and develop and integrate transport planning systems.
The projects being refinanced will support ONCF’s transition to electric, improve energy efficiency and lower greenhouse gas emissions, as well as promoting the broader shift to a more environmentally friendly form of transport.
A technical cooperation package will be rolled out together with the EBRD’s investment. It will contribute to setting up the framework for a potential sustainability-linked loan and so facilitate ONCF’s future participation in green financial products. The package will also support ONCF’s transition to adopting the International Financial Reporting Standards (IFRS).
“The EBRD’s participation in this bond issue demonstrates our continued commitment to the Kingdom of Morocco in terms of ensuring the sustainable growth of its railway network, as well as the development of Moroccan capital markets. We also aim to work with ONCF to develop further green financial products while enhancing governance initiatives,” Sue Barrett, Director of the EBRD’s Europe, Middle East and Africa (EMEA) Infrastructure team said.
“The great success of this second green bond issue is testament to ONCF’s commitment to sustainable development. As we head into a new development round, let’s remember that railways are an essential tool for reducing our mobility-related carbon footprint and championing a mode of transport that both delivers and is kind to the environment,” Mohamed Rabie Khlie, ONCF’s Chief Executive Officer, said.
This latest transaction builds on the strong partnership between the EBRD and ONCF, which began in 2022 when the country’s first infrastructure sector green bond was issued. This joint work will be a platform for further green initiatives to prepare for ONCF’s new investment plan to develop Morocco’s rail sector.
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