In January 2020, the Bolsa de Valores de Cabo Verde (Cabo Verde Stock Exchange) and the UN in Cabo Verde, under UNDP technical leadership, began designing a platform to facilitate greater exchange between the supply and demand sides of sustainable finance.
The blue finance exchange (Blu-X) platform - a regional platform for listing and trading sustainable and inclusive financial instruments, such as blue bonds, green bonds, social bonds and sustainability bonds - connects issuers and investors in sustainable bonds and supports public-private partnerships. The platform attracts investment and resources towards strategic sustainable development objectives, notably towards the blue economy as a catalyst for SDG acceleration.
The case of Cabo Verde’s Blu-X platform illustrates three insights for the implementation of sustainable finance instruments for achieving sustainable development objectives:
- Strategic context and political-economic institutions matter;
- Focus on building the institutional capacity necessary to develop instruments;
- Integrating an instrument horizontally (across sectors) and vertically (local-global) through, in the case of Cabo Verde, an INFF process can diversify development finance, while transcending the public-private divide.
Lessons from Cabo Verde can inform policy approaches in other contexts, especially in small island developing states, African middle-income countries, Portuguese-speaking African countries and others seeking to integrate capital markets into sustainable development financing strategies.