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UK debt agency chief says keeps 'open mind' on green bond issue

BRUSSELS, Nov 13 (Reuters) - The head of Britain's debt agency said on Wednesday that he kept an "open mind" about issuing green bonds, but ultimately there was a high barrier for new types of government debt because they had to provide value for cost.

Green bonds, which raise funds for specific environmental projects, have seen a surge in issuance from sovereigns and corporations in recent years.

"We have an open mind about issuance of these instruments in principle," Robert Stheeman, chief executive of Britain's Debt Management Office, told Reuters on the sidelines of a bond conference in Brussels.

"But our issuance shouldn’t incur incremental costs, compared to the core gilt programme, so there is always a high barrier for new instruments and ultimately this will always be a decision for the Treasury minister."

He said green bond issuance had to have value for money and noted that the British government has made significant steps forward in green initiatives.

The British government earlier this year announced its green finance strategy and said it had no plans for green bonds. (Reporting by Dhara Ranasinghe, editing by Larry King)