In the financial world, investments usually have only one goal: to bring in money. But given the biodiversity crisis, the World Bank decided otherwise. Indeed, the institution will issue financial securities of a new type, the “Rhino Bonds”, the purchase of which does not guarantee the collection of interest. Rather, as their name suggests, these bands will serve to protect black rhinoceroses in South Africa, which are in danger of extinction. Light on this original and unprecedented initiative.
As of March 31, 2022, the World Bank will provide a loan of $150 million in “Rhino Bonds”. RFIA† Investors who will buy these bonds [N.D.L.R : titres financiers qui équivalent à des “morceaux de dette”] will receive no interest on these securities throughout their lifetime. The profit generated from their purchase will be donated to two wildlife sanctuaries in South Africa, which are responsible for protecting black rhinoceroses, indicates RFIA†
But that’s not all, unlike regular bonds, these “Rhino Bonds” don’t guarantee compensation at the end of their life. In fact, this depends on a very specific target: the 4% increase per year in the populations of black rhinoceroses in the two African reserves. If so, a $14 million bonus can be paid out to investors after five years. If populations stagnate or decline, no payments are made.
Financial instruments to protect endangered species
Like many other species, black rhinoceroses suffer from the destruction of their environment by humans, as well as from poaching. Their horns are indeed highly prized and many specimens are killed for the horn trade. 50 years ago, nearly 65,000 black rhinoceroses lived on Earth. Today there are only 5,000 left, reports RFIA†
With its ‘Rhino Bonds’, the World Bank hopes to help save these endangered animals. If the operation is successful, it could spread to other animal species such as lions, tigers or even orangutans.