A new coalition aimed at providing consistency and transparency in financing the global sustainable blue economy has been announced.
IFC, a member of the World Bank Group, the International Capital Markets Association (ICMA), UN Global Compact, UN Environment Programme Finance Initiative (UNEP FI) and the Asian Development Bank (ADB) have joined forces to develop guidelines for bonds to finance the blue economy.
According to the World Bank, the blue economy is the “sustainable use of ocean resources for economic growth, improved livelihoods and jobs while preserving the health of ocean ecosystem”.
The world’s coastal populations contribute significantly to the global economy – an estimated $1.5 trillion (£1.2tn) per year – with expectations pointing to some $3 trillion (£2.5tn) by 2030.
The global practitioner’s guide aims to provide market participants with clear criteria, practices and examples of blue bond lending and issuances, with the organisations currently seeking further input from the financial markets, ocean industry and global institutions with the goal of producing the final edition in Autumn 2022.
ICMA provided the standards underpinning the global sustainable bond market with the Green and Social Bond Principles, the Sustainability Bond Guidelines, and the Sustainability-linked Bond Principles.
In 2021, 98% of all sustainable bonds issued globally, were aligned to these principles.
Paulo de Bolle, Senior Global Director, Financial Institutions Group, IFC said: “To support a healthy, sustainable and growing blue economy we need support from the financial and private sector and internationally recognised guidance helps build investor confidence and catalyse investments.
“Blue finance offers tremendous opportunities in closing the blue financing gap and support a thriving sustainable blue economy. Specifically, blue bonds are emerging as an innovative instrument with increased interest from investors, financial institutions and issuers globally.”
Since 2020, IFC has provided more than $400 million in blue loans and bonds to investors and issuers globally