Innovative Finance | March 29, 2022

World Bank raises $150 million ‘Rhino Bond’ for conservation in South Africa

Roodgally Senatus
ImpactAlpha Editor

Roodgally Senatus

ImpactAlpha, March 29 — Proceeds from the five-year bond will support conservation projects to increase the population of endangered black rhinos.

Investors will see returns of 3.7% to 9.2%, if populations recover at two parks that protect a majority of South Africa’s rhinos. Investors won’t receive coupon payments on the bond. Rather, the conservation sites will receive $10 million for rhino conservation.

Credit Suisse brought in donor capital to catalyze capital from private investors. The World Bank’s David Malpass said the pay-for-success structure can be replicated for other conservation and development objectives.

Investors include Nuveen, World Wildlife Fund, the foundation of the Duke and Duchess of Cambridge and the U.K. government’s Illegal Wildlife Trade Challenge Fund.

Endangered watchlist

The global black rhino population dropped 95% in the last three decades due to poaching. Publicly funded conservation efforts have helped to nearly double the black rhino population to around 5,600.

In an earlier bond, the Zoological Society of London teamed up with Conservation Capital in a five-year program to boost black rhino populations in Kenya and South Africa.

Hunting quotas

South Africa’s government last month granted hunting permits for 10 male black rhinos on conservation management land. The government says “regulated and sustainable hunting” incentivizes wildlife conservation and generates income for impoverished rural communities.