Praia, 25 January 2023 (TDI): United Nations (UN) Secretary-General, Antonio Guterres, attended the launch of “Blue Bond” by Cabo Verde at the Ocean Summit 2023.
This coincided with the world’s best sailors arriving in Mindelo, Cabo Verde, completing the initial leg of the 2023 edition of The Ocean Race.
In tourism-dependent economies, sustainable finance promotes sustainable fisheries, transport & tourism. Read about #CaboVerde's first #BlueBond, which will raise investments in its ocean economy while divesting from industries negatively impacting the 🌊.https://t.co/x1vAHCSxIe
— UN Development (@UNDP) January 24, 2023
The Blue Bond
Cabo Verde is a tourism-dependent economy, sustainable financing would promote sustainable fisheries, maritime transport, and tourism. Sustainable finance would be beneficial for the local blue economy heeling towards global Ocean Rights.
The $1 million would provide affordable loans to microentrepreneurs and startups in coastal communities. That would emphasize financial inclusion to ensure widespread access to the new value generated from the growing blue economy.
The remaining $1.5 million would be invested in structural improvements in small and medium-sized enterprises operating in the maritime and fisheries sectors.
If the demand for this would increase beyond the allotted finance, then the bond could generate $3.5 million in private and market-driven finance for a sustainable blue economy.
Blu-X Sustainable Finance Platform
The Blue Bond was launched on Cabo Verde’s Blu-X Sustainable Finance Platform. It is a regional platform for listing and trading sustainable and inclusive financial instruments.
The issuance of this bond would raise domestic, regional, and global investment in Cabo Verde. Especially, in the rising ocean economy while divesting capital from industries responsible for sea-level rise, pollution, and other transgressions against ocean rights.
The digital Blu-X is listed on the Blu-X sustainable finance platform. This means people could invest via their computer or phone, including foreign investors and members of Cabo Verde’s diaspora.
United Nations Development Programme (UNDP)
In UNDP’s Ocean Decade programme, the Blue Bond would provide strategic benefits to Cabo Verde. The partnership between UNDP and Cabo Verde has led to the issuance of four sustainable bonds that is of $32.5 million.
The project is exclusively designed for sustainable marine- and ocean-based projects generating returns for the economy, society, and environment.
“Blue” has established with a regulation in November 2022, enacted under the authority of Cabo Verde’s capital market regulatory agency.
The regulation draws on the Atlantic Technical University’s blue taxonomy, derived from a scientific study of existing blue economy activities and the potential of Cabo Verde’s shores.
This is the first kind of regulation in Africa that is pioneering Cabo Verge’s role in defining blue finance norms, standards, and principles, which closely aligns with the Ocean Race’s Sustainability Charter.
That also corresponds with the Universal Declaration of Ocean Rights of the United Nations. This is a move to establish a blue economy.
By reshaping economic incentive structures along these lines and leveraging their effects in local coastal communities, sustainable finance enhances cognizance of global ocean sustainability principles and incentivizes corresponding human action.