The United States Agency for International Development is set to allocate $8-million Livelihood Bond for estimated 385,000 women in Southeast Asia, particularly the Philippines, Cambodia and Vietnam.
In a statement on Thursday, the US Embassy in Manila said that the bond, which was structured by the Singapore-based Impact Investment Exchange is expected to be listed on the Singaporean
Exchange this month and will be the first social sustainability bond with a dual focus on social and financial returns, to be listed on a major stock exchange.
“USAID is pleased to support the Women’s Livelihood Bond with this loan guarantee,” USAID’s Regional Development Mission for Asia in Bangkok deputy mission director Todd Sorenson said.
“The bond will benefit women living in Association of Southeast Asian Nations states, particularly Cambodia, Vietnam, and the Philippines.”
USAID is also providing a 50-percent guarantee of the loan portfolio’s principal to mitigate risk, attract investors and support development.
The Women’s Livelihood Bond will also provide capital to a group of microfinance institutions and social enterprises that will help low-income women transition from subsistence to sustainable livelihoods and build their resilience to socio-economic stresses.
Long-term benefits, in addition to more successful women-owned businesses, include increased participation in the workforce, higher standards of living, and more education and health opportunities for women and children.
“This brings us one step closer to a day when our financial markets consider social and environmental impact on an equal footing with financial returns,” IIX founder Durreen Shahnaz said.
Shahnaz added that the Women’s Livelihood Bond was supported by public, private, and philanthropic institutions, including DBS Bank Ltd., ANZ Banking Group, the Rockefeller Foundation, the Clinton Global Initiative and Australia’s Department of Foreign Affairs and Trade.
The IIX founder also said that some 60-percent of the capital for this bond was provided by Asian investors, mostly private banking clients.
“IIX is planning to develop social sustainability bonds in the future,” Shahnaz said.
Since 1999, USAID – through the Development Credit Authority – has arranged more than $350 million in credit through 63 guarantees in 13 Asian nations.
USAID’s loan guarantee for the Women’s Livelihood Bond is part of its commitment to the development of the ASEAN region.
The U.S. government partners with ASEAN to support economic integration, expand maritime cooperation, cultivate emerging leaders, promote opportunity for women, and address transnational challenges.