China launches bond themed around snow leopard conservation at COP17

China has launched a bond project to support biodiversity conservation and sustainable community development in key snow leopard habitats, reports Xinhua. 

Announced on 22 October at the UN biodiversity conference COP17 in Armenia, the project seeks to raise at least CNY 10 million (USD 1.4 million) through a bond to be issued by the Qinghai branch of the People’s Bank of China. 

Activities it aims to fund include sustainable livestock farming, nature-based tourism and yak cashmere production. Businesses in these industries that pass an eligibility assessment can obtain loans at below-market interest rates, notes Xinhua. The project also seeks to support the livelihoods of conservation rangers, the outlet states.

The project also has an outcome assessment framework, reports Yicai. It evaluates aspects including businesses’ conservation actions and snow leopard population trends.

It is not the first bond project dedicated to biodiversity conservation. In 2022, the World Bank issued a USD 150 million bond to support black rhino conservation in South Africa. Around USD 10 million went towards conservation efforts in two protected areas. The bond linked financial returns to conservation results: investors could receive an additional payment of up to USD 13.76 million if rhino populations grew, funded by a grant from the Global Environment Facility (GEF). 

The snow leopard project takes a different approach. It uses philanthropic funding to subsidise interest payments on eligible loans after an independent assessment of conservation results, Zhao Xiang told Yicai. He is conservation director of the Shan Shui Conservation Center, which is providing technical support for the bond project.

Countries worldwide have been seeking to increase funding for biodiversity. The Kunming-Montreal Global Biodiversity Framework calls for at least USD 200 billion a year by 2030 from a wide variety of sources to halt and reverse biodiversity loss. It also encourages new financing approaches, including green bonds and blended finance, which combines public or philanthropic funding with private investment.

At COP17, the GEF announced more than USD 500 million in additional funding pledges for environmental initiatives, bringing overall funding to USD 4.4 billion.

Read Dialogue Earth’s previous report on how Chinese companies are piloting nature-related disclosures.