Financing climate and sustainability policies: The impact of sustainability bonds on the Basque country

Abstract

Climate finance refers to the flow of financial resources for the fight against climate change and contribute to the achievement of the Sustainable Development Goals (SDG). The debt market can play an essential role through Sustainability Bonds. To finance projects aligned with the SDGs and the Agenda Basque Country 2030, in 2018, the Basque Government issued sustainability bonds for a total value of 500 million Euros. The aims of this paper are to assess the individual impact of each project using economic, social and environmental impact indicators; and to estimate the total impact of the bond on production, income and employment in the Basque Country using input-output tables. Results show that, for every euro invested, an increase in production of 1.69 and in income of 0.398 is generated. Likewise, for every million Euros invested, 16.79 jobs are created. © 2020 Servicio Central Publicaciones. Gobierno vasco.