IDB Invest launches first private sector bond for Amazon rainforest’s green and social initiatives
IDB Invest, the private sector arm of the Inter-American Development Bank Group, has issued the IDB Group’s first private sector bond to fund green and social initiatives in the Amazon region.
This bond aims to create economic opportunities for the private sector while protecting the critical rainforest.
IDB said private capital is crucial for the region’s transition to a bioeconomy that supports decarbonization, sustainable use of biological resources, and incorporation of both technology and ancestral knowledge.
The proceeds from the five-year, 50 million reais bond will support projects aligned with Amazonia Forever’s goals.
Read more: Over a third of Amazon rainforest struggle to recover from droughts, study finds
James Scriven, CEO of IDB Invest, said, “The successful placement of this private sector bond shows an emerging investor appetite to support sustainable development in the Amazon, which is essential to regulating the global climate.”
The Record Emerging Market Sustainable Finance Fund purchased the bond issuance, which was arranged by J.P. Morgan. This bond, IDB Invest’s first issue denominated in Brazilian reais, is part of the IDB Group’s strategy to attract private capital to support the sustainable development of the Amazon.
Read more: World Bank and HSBC to launch $200 million outcome bond for Amazon reforestation
Scriven added, “To attract more capital, we are developing a solid pipeline of bankable projects in areas such as clean energy, water and sanitation, digital connectivity, bioeconomy, and financial inclusion. We will continue testing investor demand and pave the way for full-fledged Amazonia Bonds.”
Under the Memorandum of Understanding between the World Bank and the IDB Group, both institutions are collaboratively working towards developing investment guidelines for the Amazonia bonds.
These guidelines will outline how to use proceeds, performance indicators, and sustainability performance targets. National governments, public development banks, and local communities will review them.
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