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Japan’s Ministry of Finance Approves Government Guarantee for NEXCO’s Social Bond Issuance
Tokyo, Japan – August 1, 2025 – The Ministry of Finance has announced the approval of a government guarantee for the 518th bond issuance by the Japan Expressway Holding and Debt Repayment Organization (NEXCO). Notably, this issuance will be structured as a social bond, underscoring a commitment to financing projects with positive social impacts. The announcement, published on August 1, 2025, at 6:00 AM JST, signifies an important step in NEXCO’s ongoing efforts to secure funding for its essential infrastructure operations and development.
This government guarantee is a crucial mechanism that enhances the creditworthiness of the bonds. By attaching the sovereign guarantee, the Ministry of Finance signals strong confidence in NEXCO’s ability to meet its financial obligations. This, in turn, is expected to attract a broader range of investors and potentially lower the borrowing costs for NEXCO, making the financing more efficient and sustainable.
The designation of these bonds as “social bonds” is particularly noteworthy. Social bonds are specifically designed to raise capital for new or existing projects that have positive social outcomes. While the specific projects to be financed by this particular issuance have not been detailed in this announcement, NEXCO’s core mission involves the maintenance, management, and debt repayment of expressways across Japan. These activities are inherently vital for the nation’s economic activity, public safety, and the seamless movement of people and goods. Projects that improve road safety, enhance accessibility, or contribute to disaster resilience, for instance, would typically fall under the umbrella of social impact.
The Ministry of Finance’s decision reflects a strategic alignment with national objectives, recognizing the critical role of robust transportation infrastructure in supporting the Japanese economy and society. The government guarantee not only facilitates NEXCO’s financial operations but also reinforces the perceived stability and importance of the expressway network.
This move also highlights the growing trend of utilizing social and green finance instruments within public sector financing. By issuing social bonds, NEXCO can clearly communicate its commitment to societal well-being and attract investors who are increasingly prioritizing environmental, social, and governance (ESG) factors in their investment decisions. This approach can broaden the investor base and potentially foster greater engagement with stakeholders who are aligned with NEXCO’s social objectives.
The successful issuance of these government-guaranteed social bonds is anticipated to contribute significantly to NEXCO’s long-term financial stability and its capacity to undertake necessary upgrades and maintenance, ultimately benefiting users of Japan’s extensive expressway network. Further details regarding the specific terms and allocation of the bond proceeds are expected to be made available in due course.
第518回日本高速道路保有・債務返済機構債券（ソーシャルボンド）に対する政府保証の付与
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財務省 published ‘第518回日本高速道路保有・債務返済機構債券（ソーシャルボンド）に対する政府保証の付与’ at 2025-08-01 06:00. Please write a detailed article about this news in a polite tone with relevant information. Please reply in English with the article only.