ADB’s first Blue Bond Incubator to help scale up sovereign and corporate blue bond issuances for critical ocean investment in Asia and the Pacific

The Asian Development Bank (ADB) on Wednesday launched the world’s first Blue Bond Incubator to support ocean-related projects in Asia and the Pacific, an investment vital for combating the impact of climate change and protecting the livelihoods of hundreds of millions of people.

The launch was held at the 7th Our Ocean Conference in Palau, which gathered government officials, civil society representatives, and industry leaders who together have committed more than $91 billion for the protection and restoration of oceans.

The Blue Bond Incubator is supported by ADB’s Asia-Pacific Climate Finance Fund (ACliFF) and will help scale up sovereign and corporate blue bond issuances for critical ocean investment.

“Ocean-based climate mitigation and resilience are key to climate change action. ADB, in partnership with the public and private sectors, is ready to demonstrate leadership through developing science-based solutions and market tools to reverse the decline in ocean health,” said Director General of ADB’s Sustainable Development and Climate Change Department Bruno Carrasco.  

“Ocean investments are key to building resilient communities and economies, and the ADB Blue Bond Incubator will grow the blue economies at scale,” said ADB Director General for the Pacific Leah Gutierrez.

Blue bonds are an innovative finance mechanism that raise debt to fund ocean projects. Work under the incubator will develop a standardised global guidance for the issuance of blue bonds, in collaboration with the International Capital Markets Association, the International Finance Corporation, United Nations Environment Programme Finance Initiative, and United Nations Global Compact. 

The first partner is the Fiji Ministry of Economy, which requested ADB’s support to develop and issue its first blue bond. Together with the UN Global Compact and the Ocean CFO Taskforce, the incubator is also identifying potential corporate partners. Both sovereign and corporate partners will be able to access technical assistance to develop and issue blue bonds. 

The Blue Bond Incubator is part of ADB’s Action Plan for Healthy Oceans and Sustainable Blue Economies, which was launched in 2019 and aims to catalyse sustainable investments in Asia and the Pacific by committing to invest and provide technical assistance of at least US$5 billion by 2024. The programme builds on ADB’s first blue bond issuance in September 2021.

Blue bond proceeds will finance projects that enhance ocean health through ecosystem restoration, natural resources management, sustainable fisheries and aquaculture, reduction of coastal pollution, circular economy, marine renewable energy, and green ports and shipping. At the same time, these investments will support sustainable economic growth and jobs for the future.

This story was originally published at ADB on 13 April 2022, reposted via PACNEWS.