IFC, a member of the World Bank Group, and Amundi, the leading European asset manager, announced the final closing of the SEED, which stands for - Sustainable Emerging Economy Development Debt (the “Fund”), a sub-fund of Amundi Planet II, SA SICAV-RAIF. Launched in 2021 on the sidelines of COP26 in Glasgow, the fund has raised $436 million from institutional investors, including IFC, Alecta, Cassa Depositi e Prestiti (“CDP”), and APK-Pensionskasse, thereby mobilizing private investment in emerging market sustainable bonds, with the objective of promoting a green, resilient, and inclusive economic recovery. The Fund is classified as Article 8 under the Sustainable Finance Disclosures Regulation (SFDR)[1].
The initiative is intended to help to expand the availability of and demand for underdeveloped segments of the sustainable bond market, strengthening the asset class and driving greater resources towards priority areas such as climate mitigation and gender equality. The capital structure seeks to limit the risk for commercial investors who might be otherwise averse to investing in impact-oriented bonds on their own, particularly in less developed markets. In addition to mobilizing much needed capital, the strategy provides a new model for other asset managers and institutional investors to replicate, further amplifying its impact.
We are proud to play a leading role in responsible finance together with the IFC, tackling key challenges such as inequality and climate change. This Fund is a great example of the benefits of public-private partnerships in creating new markets trying to help addressing financing gaps in regions where funding is most needed.
The Fund requires that investments comply with International Capital Markets Association Principles (ICMA) governing sustainable bonds and will implement review mechanisms and impact reporting to ensure such investments are aligned with the strategy’s goals. The strategy contributes to IFC’s commitments under the World Bank Group’s Climate Change Action Plan. To extend the reach into low-income countries, the International Development Association’s Private Sector Window (IDA PSW) is providing a partial credit guarantee through its Blended Finance Facility. To further support the strategy, a Technical Assistance Facility was designed to increase the quality and quantity of sustainable bond issuance in emerging markets, deepening market awareness and strengthening best practices across the industry.
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[1] The fund promotes environmental or social characteristics, but does not have as its objective a sustainable investment
