As local companies seek financing to grow and seize new opportunities amid a green transition, IFC is investing up to VND 3,500 billion (around $150 million) in local currency sustainability-linked bonds (SLBs) to be issued by BIM Land Joint Stock Company and its subsidiary Thanh Xuan Joint Stock Company. The first local currency SLBs in Vietnam, they aim to help issuers expand their businesses while creating jobs, boosting competitiveness, and supporting the country's low-carbon growth model.
IFC's investment comprises two subscriptions—up to VND 2,333 billion (about $100 million) to be issued by BIM Land—a leading tourism and property developer in Vietnam—and up to VND 1,167 billion (about $50 million) to be issued by Thanh Xuan Joint Stock Company. Both the issuers are subsidiaries of BIM Group, a multi-sector corporation in Vietnam. The proceeds will be used to develop the Thanh Xuan valley project in Vinh Phuc province, including an eco-friendly and unique residential community alongside a hotel complex—under the InterContinental brand—and other relevant services and infrastructure. IFC's funding will also help the developers implement water and energy savings solutions in two BIM Land hotels—InterContinental and Regent—in Phu Quoc island.
An innovative financing tool to support global sustainable development, these SLBs will provide financial incentives for both BIM Land and Thanh Xuan Joint Stock Company to improve water conservation and energy efficiency in three of their hospitality assets to be accredited by EDGE, IFC's green building certification system. This is expected to avoid an estimated 4,000 metric tons of CO2 annually—equivalent to greenhouse-gas emissions from 890 gasoline-powered passenger vehicles driven for a year.
"Sustainability is a critical part of our strategy to position BIM Land as a leading property developer and operator in Asia with a long-term vision. We hope to attract international investors as we develop green and quality tourism infrastructure across the country," said Doan Quoc Huy, BIM Group's Vice Chairman and Chief Executive Officer. "Most importantly, IFC's financing and advice will help catalyze our green transition in line with the industry's good practices and global climate goals."
IFC has also helped BIM Land develop a sustainability-linked financing framework with tailor-made sustainability performance targets.
"Private capital is key to Vietnam's green transition. The issuance of the first local currency SLBs in the country will signal the viability of innovative green financing instruments as an alternative source of capital for climate-smart projects," said Thomas Jacobs, IFC Country Manager for Vietnam, Cambodia, and Lao PDR. "IFC's funding will also encourage developers to align their interests with responsible investment and to mobilize funding from green capital markets, paving the way for sustainable tourism sector."
In line with the government's twin goals to become a high-income country by 2045 and achieve net zero by 2050, climate and sustainability have become bigger focus areas for IFC engagements in Vietnam. To date, IFC committed over $900 million in long-term finance to support climate-related projects in the country. IFC's commitments in Vietnam reached close to $1.9 billion in fiscal year 2023, ending June 30, helping local companies recover from the COVID-19 pandemic and navigate challenging internal and external environments.
