IDB Invest has issued a blue bond worth 50 million Australian dollars (32.3 million euros) at 20 years, maturing in November 2042, with the aim of financing private sector projects that contribute to promoting the sustainable use of water resources.
Specifically, the purpose of this bond is to help achieve UN Sustainable Development Goal 6, Clean Water and Sanitation, promoting better livelihoods and jobs, as well as ocean conservation.
Blue bonds can provide financing to numerous businesses that have a positive impact, including businesses located near bodies of water, onshore businesses that support the health of the ocean ecosystem, and water and sanitation projects.
Blue bonds are especially relevant for Latin America and the Caribbean, with a large part of its population living in coastal areas. The Caribbean is home to 23 small, island countries surrounded by coastlines and which are especially vulnerable to the effects of climate change. “With this second blue bond, IDB Invest continues to promote an innovative approach to finance climate action and attract new investors to the region,” the IDB group explained.
Right now, blue bonds are emerging as an innovative way to finance ocean and water-related solutions, create sustainable business opportunities, and signal responsible ocean stewardship to the market.