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01 June 2021

Bangladesh has recently prepared a report on ‘Promoting Sustainable Blue Economy in Bangladesh Through Sustainable Blue Bond: Assessing the Feasibility of Instituting Blue Bond in Bangladesh’ with the technical and financial assistance of the ‘Strengthening Institutional Capacity for SDGs Achievement in Bangladesh (SC4SDG)’ project of UNDP-UNEP Poverty-Environment Action for Sustainable Development Goals through the financial support of the Governments of Austria, Sweden, and the European Union. This is the first time Bangladesh has undertaken a study to assess the viability of introducing blue bond in the bond market.

Bangladesh acknowledges that resource mobilization from different sources will be the key in achieving SDGs in the country and therefore, emphasizes on investigating new innovative financing strategies to finance the Global 2030 Agenda. The country has recently introduced two sustainable bonds – sukuk bond and green bond – in the bond market to finance the implementation of a safe supply water project, enhance micro-credit operations, and ensure environmental development. This initiative is expected to incentivize, especially the private sector, to promote financing for sustainable development.

There is an appetite for absorbing new types of bonds in the bond market of Bangladesh. Thus, the country should make a feasible plan and engage in expanding the horizon by issuing more ‘sustainable bonds’ to raise funds for financing specific projects in order to promote environmental sustainability and socio-economic development.

Bangladesh has huge scopes for ocean-based traditional as well as new economic activities. If the coastal and marine ecosystem resources can be used effectually, they can be a great asset for the economy in increasing food security, generating employment, alleviating poverty, and reducing inequality. Nonetheless, promoting the sustainable blue economy requires huge investment. To be successful, Bangladesh will need to adopt a solid approach to mobilize funds through developing fixed-income securities or sustainable bonds, e.g., blue bond.

Blue bond can be an innovative approach to finance the blue economy in Bangladesh. However, there is a lack of consciousness and expertise on blue bond since it is comparatively a new concept. Knowledge products and more action-oriented discussions will be needed to sensitize both the state and non-state stakeholders on the blue economy and sustainable financing solutions. In this case, this report will help Bangladesh to ameliorate its know-how on the blue economy and its prospect, bond market, suitability of bond financing, and likelihood for releasing a blue bond in Bangladesh along with mapping the pathway of releasing such a bond.