ADB Invests $40 Million in Green Bonds for a Climate-Resilient Water Supply in Georgia

TBILISI, GEORGIA (26 July 2024) — The Asian Development Bank (ADB) has invested $40 million in a bond issuance by Georgia Global Utilities JSC (GGU). The certified green bond—the largest ever issued from a Georgian private corporate entity—aims to enhance the water system in Tbilisi and neighboring municipalities, building resilience against climate change on surface and groundwater resources.

The financing includes debt investments of $20 million from ADB’s ordinary capital resources and $20 million from Leading Asia’s Private Sector Infrastructure Fund 2, administered by ADB, on behalf of the Japan International Cooperation Agency (JICA). The investment forms a part of a $300 million, 5-year issuance by GGU. The funds will be used to modernize the supply network in and around Tbilisi, ensuring a potable water supply for about 1.4 million residents. The German development finance institution DEG, the European Bank for Reconstruction and Development, and the International Finance Corporation are also participating in the bond issuance.

“ADB’s anchor investment in GGU’s green bond will boost international confidence in Georgia’s capital market and enhance the country’s climate resilience,” said ADB Director General for Private Sector Operations Suzanne Gaboury. “This investment marks the beginning of a new partnership with FCC Aqualia and strengthens our relationship with Georgia Capital. ADB is committed to supporting developing member countries in mobilizing domestic and foreign private capital for bankable and impactful development projects.”

Since 2019, ADB has pioneered environmental, social, and governance (ESG) thematic-bond market development in Georgia. ADB has played a catalyzing role in landmark transactions including the first and largest green, gender, and sustainability-linked bonds in US dollar and local currency. GGU’s green bond is certified by Det Norske Veritas and complies with the International Capital Markets Association’s Green Bond Principles. Green bonds are used to finance projects that help to achieve climate goals.

"GGU’s green bond issuance aims to finance important investments that will improve Georgians’ access to safe and reliable water supply while supporting the country’s adaptation to the adverse effects of climate change," said FCC Aqualia S.A. Chief Financial Officer Isidoro Marbán. “This landmark transaction promotes sustainable financial instruments and standards in Georgia and the Caucasus region. We are thankful for ADB’s support and look forward to further collaboration on climate investments.”

Since 2011, ADB has invested over $800 million in Georgia’s water sector contributing to the country’s resilience to climate change. GGU is owned by Aqualia Georgia LLC and Georgia Capital JSC (GCAP), one of Georgia’s largest and most diversified investment companies. Aqualia Georgia LLC is a subsidiary of a leading Spanish water company, FCC Aqualia S.A., which operates in 18 countries.

LEAP 2 is an ADB-managed fund with a $1.5 billion commitment from JICA. It focuses on sustainable private sector infrastructure projects that reduce carbon emissions, improve energy efficiency, and provide affordable health care, education, and communication services to ADB’s developing member countries. The LEAP 2 investment in the bond issuance by GGU is its second transaction since the fund's replenishment in December 2023.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.