World’s First Wildlife Bond to Track Rhino Numbers in Africa

A bond designed to raise funds to grow the population of endangered black rhinoceros in South Africa will be sold by the World Bank this year.

The five-year, 670 million rand ($45 million) security will be the world’s first wildlife conservation bond and the aim is to sell it in the middle of the year. Returns for investors will be determined by the rate of growth of the populations of the animals in two South African reserves, according to the Rhino Impact Investment Project, an initiative started by the Zoological Society of London.

If successful, the program could be expanded to protect black rhino populations in Kenya as well as other wildlife species such as lions, tigers, gorillas and orangutans, Rhino Impact said in a document detailing the proposal. It provides an opportunity for people interested in conservation to get a return on their support and possibly re-invest money in new projects rather than the more traditional route where projects are funded by philanthropists or governments.

“The innovative wildlife conservation bond financing mechanism plans to use a World Bank, International Bank for Reconstruction and Development IBRD AAA-rated bond,” it said. Credit Suisse Group AG is advising on the project.

The World Bank will also sell a $100 million conservation bond at the same time, without specifying what it will be used for.

Under the terms of the rhino bond, investors will forgo an annual coupon and will instead receive their original capital and an additional payout depending on how much the rhino population has grown over five years. The principal of the bond and the possible payout at maturity will be paid by the Global Environment Facility, which has received donations from more than 40 countries and was formed ahead of the Rio Earth Summit in 1992.