“The Government’s USD 8.8 million investment in hybrid bonds is an important step in changing and modernising Sweden’s development assistance. These bonds provide a unique opportunity to strengthen the IBRD's capacity to finance transformational projects in areas such as climate. The revenues generated, known as the coupon rate, will simultaneously support vital efforts in Ukraine,” says Minister for International Development Cooperation and Foreign Trade Benjamin Dousa.

The IBRD is part of the World Bank Group. In conjunction with ongoing reform of the IBRD, the member countries have decided to strengthen its mandate to address the climate transition and other global challenges. Increased economic support from its member countries is required for the IBRD to carry out this task. This will be achieved by way of capital injections in the form of hybrid bonds issued by the IBRD.

Hybrid bonds combine the qualities of shares and bonds. They are also perpetual, which makes them an effective tool to strengthen the IBRD. This instrument allows for increased lending to projects that are crucial to address the climate transition and other global challenges. Thanks to this innovative financing model, every krona invested results in up to SEK 8 in increased lending.

By investing in hybrid bonds, Sweden is demonstrating its strong commitment to sustainable global development and its will to support the development of innovative financing solutions for development cooperation.