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Drought-Riven Chile Makes World First in Environmental Bonds

  • The nation sold $2 billion of SLBs maturing in 20 years
  • Chile’s government is already LatAm’s biggest ESG-bond issuer
A person rides a horse through a dry river in Maule, Chile, in 2020. An epic drought has sent Chilean water levels plummeting as much as 57% over the last decade.

A person rides a horse through a dry river in Maule, Chile, in 2020. An epic drought has sent Chilean water levels plummeting as much as 57% over the last decade.

Photographer: Tamara Merino/Bloomberg
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Chile issued bonds tied to sustainability goals, the first nation in the world to do so, as the country wracked by a decade-long drought looks to cut greenhouse gas emissions, and obtain cheap financing.

The government sold $2 billion in dollar-denominated, sustainability-linked bonds maturing in 20 years, according to a person with knowledge of the matter. The offering yields 2 percentage points above Treasuries after initial discussions in the area of 2.4 percentage points, said the person, who asked not to be identified as the details are private.