The Seychelles announced the launch of the world’s first sovereign blue bond at the fifth edition of the Our Ocean Conference.
Proceeds from the bond will support expansion of MPAs, improved governance of priority fisheries and development of the blue economy in the Seychelles.
The World Bank assisted the Seychelles in developing the blue bond and engaging Calvert Impact Capital, Nuveen and Prudential Financial, Inc as investors in the bond.
29 October 2018: Seychelles has launched a US$15 million blue bond to support sustainable fisheries and marine projects. Seychelles announced the bond at the fifth edition of the Our Ocean Conference.
According to the World Bank, a blue bond is an innovative financial instrument used to finance ocean and marine-based projects that have positive economic, environmental and climate benefits. The blue bond concept is inspired by the green bond concept. Examples of eligible activities include fisheries management plans, stock rebuilding, improved value chains, aquaculture development and promotion of sustainable practices and education awareness programmes.
The World Bank assisted Seychelles in developing the blue bond and in reaching out to Calvert Impact Capital, Nuveen and Prudential Financial, Inc. The Blue Grants Fund and Blue Investment Fund, managed by the Development Bank of Seychelles (DBS) and Seychelles’ Conservation and Climate Adaptation Trust (SeyCCAT), will provide grants and loans. The Seychelles blue bond is guaranteed by a US$5 million guarantee from the World Bank and a US$5 million concessional loan from the Global Environment Facility (GEF) that will partially cover interest payments for the bond.
The bond will assist Seychelles in safeguarding our oceans while we sustainably develop our blue economy.
Proceeds from the bond will support expansion of marine protected areas (MPAs) to 30 percent of the country’s exclusive economic zone (EEZ), improved governance of priority fisheries and development of the blue economy in Seychelles. The main beneficiaries of the bond are Seychellois who depend on marine resources and the ocean for their livelihoods, including artisanal and semi-industrial fisheries, tourism operators and operators engaged in seafood value chains, among others. The bond will also contribute to the World Bank’s South West Indian Ocean Fisheries Governance and Shared Growth Program (SWIOFish3), which supports countries in the region to increase economic benefits from their fisheries sectors while sustainably managing their fisheries.
Seychelles’ Vice President Vincent Meriton said the blue bond is part of an initiative that combines public and private investment to mobilize resources to empower local communities and businesses. Meriton emphasized the bond will assist Seychelles “in achieving a transition to sustainable fisheries and safeguarding our oceans while we sustainably develop our blue economy.”
The World Bank emphasized that the bond “demonstrates the potential for countries to harness capital markets for financing the sustainable use of marine resources.” The World Bank’s Vice President of Sustainable Development, Laura Tuck, said the Bank believes this sovereign blue bond “can serve as a model for other small island developing States and coastal countries,” and is a signal that investors are increasingly interested in supporting sustainable management and development of the world’s oceans.
The Our Ocean Conferences have resulted in over 1,200 concrete, measurable and tracked commitments in support of sustainable management of the world’s oceans. The 2018 Our Ocean Conference took place in Bali, Indonesia, from 29-30 October. [World Bank Press Release] [World Bank News Story] [GEF Press Release] [Blue Bond Infographic] [FAQs on Blue Bond] [Our Ocean Conference Website] [SDG Knowledge Hub Story on Approval of Blue Bond]