The first ever sovereign SDG bond is expected to be issued later this year, RI has learnt. The transaction will be part of new efforts by the UN to create a market for ‘Women’s Bonds’ – aimed at advancing the fifth Sustainable Development Goal for global gender equality by 2030.
The issuer of the debut deal is not clear, but RI understands that the initiative has identified several sovereign issuers interested in issuing such SDG bonds, which will initially focus on ending female genital mutilation (FGM) and child marriage across Africa.
The bonds are expected to address SDG 5 primarily through the inclusion of a covenant, linking the coupon a substantial decrease in FGM and child marriage by a certain date, rather than through a convention use-of-proceeds approach – although some could also include ringfencing of proceeds for the same goals.
While each deal will be bespoke, it is expected that several will include guarantees from developm…