Unlocking Local Potential: How Quasi-Sovereigns and Thematic Bonds can Power Sustainable Development in LAC

Thematic bonds, including green, SDG, and sustainability-linked bonds, have demonstrated their effectiveness in directing capital towards sustainable investments. ¹ While LAC has witnessed growth in sovereign thematic issuances and innovative financial instruments, the participation of quasi-sovereign entities in this market remains limited. Currently, their international thematic bond issuances in the region account for only a small fraction of the total thematic bond market. This disparity highlights a significant opportunity to unlock local capital, strengthen domestic markets, and accelerate progress on Nationally Determined Contributions (NDCs) and SDGs by further empowering quasi-sovereign issuers.  

CAF and GGGI’s Role

As a technical partner with a strong regional footprint, GGGI has supported numerous sovereign and quasi-sovereign entities in accessing sustainable financing vehicles. It brings deep experience in providing transactional technical assistance to thematic bond issuers across public, private, and financial sectors in the LAC region, helping strengthen institutional capacity and readiness to engage in sustainable finance markets.

CAF, in its role as a regional development bank, is committed to unlocking local sustainable finance ecosystems. It has structured specialized credit facilities for climate and development finance and contributed to improving enabling conditions in the region. Building on its newly launched Sustainable Finance Framework, CAF aims to scale up replicable solutions that support countries and subnational entities in aligning their financing with sustainability goals.

CAF can support quasi-sovereign issuers by:

• Developing national and subnational sustainable finance taxonomies and frameworks
• Structuring thematic bonds aligned with international standards and local priorities
• Acting as an anchor investor to increase market confidence and attract private capital
• Co-developing enabling policy environments and institutional capabilities for long-term sustainability

CAF's work with Banco de Desarrollo Productivo (BDP) in Bolivia marks an important step in supporting quasi-sovereign issuers in the region. This experience serves as a foundation for broader engagement, and CAF is now strategically positioned to become a regional enabler of next-generation sustainable finance solutions.

Key Topics

• Emerging trends and gaps in the LAC thematic bond market 
• Institutional readiness and regulatory frameworks for quasi-sovereign participation 
• Opportunities to scale local investment vehicles aligned with climate and development goals 
• Case studies of successful quasi-sovereign issuances and lessons learned 
• The role of MDBs, technical partners, and anchor investors in enabling market growth
• Forward-looking models for replicable and scalable sustainable finance solutions

• Date: April 30th, 2024. Fourth Preparatory Committee for FFD4, 2025, New York 
• Time: 16:45 – 18:00 (EST)
• Location: Conference Room D. United Nations Headquarters in New York City.
• Registration and accreditation are mandatory