IDB Invest, the private sector arm of the Inter-American Development Bank Group, has issued the IDB Group’s first private sector bond to finance green and social initiatives in the Amazon region. The issuance aims to create economic opportunities for the private sector while protecting the region’s critical rainforest.

Private capital will play a critical role in the region’s transition toward a bioeconomy that promotes decarbonization, makes sustainable use of biological resources and incorporates both technology and ancestral knowledge. The proceeds of the five-year 50 million reais bond are geared towards projects aligned with the objectives of Amazonia Forever, the IDB Group’s holistic umbrella program that seeks to upscale financing for the sustainable development of the Amazon region.

The bond issuance was purchased by Record Emerging Market Sustainable Finance Fund, and it 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 help finance sustainable development of the Amazon.

“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. 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,” said James Scriven, CEO of IDB Invest.

Looking ahead, as part of the Memorandum of Understanding between the World Bank and the IDB Group, both institutions are jointly developing investment guidelines for Amazonia Bonds, an innovative group of financial instruments that will provide funding for a broad range of development goals that may also include public sector projects. These guidelines will govern use of proceeds, performance indicators, and sustainability performance targets, and will be vetted by national governments, public development banks, and local communities.

Transaction Summary

About IDB Invest

IDB Invest, a member of the Inter-American Development Bank Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of $21 billion in assets under management and 394 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

About Amazonia Forever

The Amazonia Forever is a holistic umbrella program that aims at protecting biodiversity and accelerating sustainable development in three lines of action: expanding funding, boosting knowledge exchange, and facilitating regional coordination among the eight Amazonian countries.  

The program is based on five pillars: (i) Combating deforestation and strengthening environmental control and security in the context of national governments; (ii) Bioeconomy and creative economy, promoting alternative and sustainable economic activities; (iii) People, aiming at adequate access to quality education, healthcare, and employment; (iv) Sustainable cities and infrastructure and connectivity; and (v) Sustainable, low-carbon agriculture, livestock and forestry. In addition, the program focuses on promoting the inclusion of women, indigenous peoples, people of African descent and local communities; climate and forest conservation; and strengthening institutional capacities and the rule of law.

About Record

The Record Emerging Market Sustainable Finance Fund is an Article 8 fund under Regulation (EU) 2019/2088 that aims to support the development of local currency markets in low and middle-income economies together with improved access to long-term local currency lending. This unique investment strategy represents a significant innovation in currency markets and a commitment to the development of new sustainable investment products for private investors globally, which Record expects to have broad and growing appeal for years to come.