The Oceans Finance Company group will help protect the islands of Ecuador. What will be the financing and the global treaty to end plastic pollution.
Oceans Finance Company (OFC), a climate finance group that helps protect the Galapagos Islands of Ecuador. The group plans to obtain US$1 billion through a new type of debt structure to help finance environmental projects, its chief executive told Reuters. His plan is to buy Eurobonds Ecuadorians with money obtained from multilateral lenders, philanthropists and institutional investors and pay each an agreed portion of the annual coupon.
He rest would be used to help finance projects such as removing plastics from the ocean and restoring mangroves. OFC began fundraising this month and hopes to generate US$2,000 million more for impact activities once fully developed.
The protection plan for the Galapagos Islands
To attract the most risk-averse investors, OFC said it was speaking to insurers in the Lloyd’s of London market to acquire coverage that effectively guarantees profitability. The bonds would be held in an instrumental company dedicated to the initiative.
“It allows us to mobilize the entire difference between the cost of capital and the financing we have for the impact”said Erik Wandrag. “It also allows us to speed up not only transactions, but also the impact we want to achieve”, he added, describing the plan as part of a regional program for the Latin American Pacific coast that could also be replicated in Africa.
The need is pressing. An OECD study estimated that in 2022 there would be 30 million tons of plastic waste in the seas and oceans of the world and others 109 million tons accumulated in its rivers.
The plan to clean oceans and rivers of plastic waste
He OFC’s main shareholder is Climate Fund Managers (CFM), of the Netherlands, which created funds in association with entities such as the Dutch Fund for Climate and Development (DFCD) and the European Commission. Although OFC is in contact with the Ecuadorian Government, Wandrag says no formal approval needed to move forward. And since there is no debt restructuring and bonds can be purchased on the open market, the approach could be replicated almost anywhere.
Nearly 180 governments will meet in Korea in November to celebrate the fifth and final round of negotiations of a tglobal effort to end plastic pollution. The plan is for the agreement to be formally signed early next year in the Galapagos.
Source: Ambito
