World Bank Launches Initiative to Issue USD 10 Billion in Sustainable Development Bonds while Highlighting the Urgency of Mainstreaming Climate Action

Washington: The World Bank (International Bank for Reconstruction and Development, IBRD, AAA/Aaa) is raising awareness for the urgency to integrate climate change considerations in all activities and decisions. As part of a plan to issue USD 10 billion in Sustainable Development Bonds, the World Bank will engage with investors to highlight the World Bank’s holistic approach to mainstreaming climate action.

As detailed in its newly updated Climate Change Action Plan, the World Bank helps countries integrate climate change into their development strategies and apply climate financing in ways that achieve the most positive impact. Applying a “whole of economy” approach with developing country clients helps the World Bank mainstream climate considerations across its portfolio, including in high emitting sectors as well as sectors not typically associated with climate action such as health, education, trade, and governance.

“Left unchecked, climate change will push 130 million people into poverty over the next decade. We must mobilize everyone and everything we can to reverse today’s climate trends and in doing so we need to support vulnerable communities and help them adapt,” said Anshula Kant, World Bank Group Chief Financial Officer. “To achieve the scale necessary, we must go beyond just green projects to support the greening of entire economies. With investor engagement around our own issuance and climate strategy, we hope to illustrate to investors why a similar holistic approach is critical for the markets,” she added.

In 2020, the World Bank provided more climate finance than ever. Over 90 percent of all IBRD projects had climate components, representing 33 percent of all commitments by value. Recognizing that communities in developing countries are often the most vulnerable to the impacts of climate change including droughts, floods and coastal erosion, the World Bank committed to deliver at least half of its climate funding for climate change adaptation, and help its members become more resilient.

Jingdong Hua, Vice President and Treasurer, said, “World Bank Sustainable Development Bonds provide investors with an opportunity to support positive climate impacts in developing countries through a liquid investment with high-credit quality. As previous World Bank investors have done through Sustainable Development Bond themes such as Water & Oceans, Gender, Health and Nutrition, and Food Loss and Waste, their participation signals their commitment to meeting the world’s challenges head-on. We are pleased to launch this initiative and look forward to engagement with investors ahead of COP26.”

World Bank Sustainable Development Bonds provide funding to World Bank projects and programs in its member countries, including those aimed at meeting the objectives of its Climate Change Action Plan. The World Bank leverages capital from member governments to raise funding in the capital markets from private entities such as asset managers, pension funds, bank treasuries and official institutions.

“While issuing Sustainable Development Bonds we highlight the next step of how we, as a lending institution, are making sure that all World Bank activities maximize climate change mitigation and adaptation efforts”, said Bernice Van Bronkhorst, Global Director, Climate Change, World Bank. “In addition, the funds raised will then support the financing of the full range of the World Bank’s development activities, which are also now aiming for greater climate impact. This is the kind of holistic approach that our recently announced Climate Change Action Plan is driving forward.”

With annual issuances between USD 50 – USD 60 billion, all World Bank bonds finance programs that support the Sustainable Development Goals. World Bank Sustainable Development Bonds are aligned with the sustainability bond guidelines published by the International Capital Markets Association (ICMA). A key priority for the World Bank’s engagement in the capital markets is to encourage investors take a comprehensive approach to mainstream climate and sustainability in all of their decision-making, while building strategic partnerships to raise awareness for the role of private sector financing in development.


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