PRESS RELEASE October 10, 2018

World Bank Bonds Connect Global Investors to Indonesian Capital Markets

Washington, D.C., October 10, 2018The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) has issued four Indonesian rupiah-denominated bonds totaling IDR 5.3 trillion—approximately US$360 million—since August 2018. The bonds include an IDR 1.5 trillion—US$ 98.8 million equivalent—bond focused on water and ocean resources on October 4, and account for one third of total issuances by supranational issuers in the IDR market this year.

The bonds build a bridge between international capital and the country’s development priorities, as Indonesia hosts the Annual Meetings of the World Bank Group and IMF in Bali this week.

The World Bank began issuing Indonesian rupiah bonds for the first time in August, supporting the country’s capital markets by connecting international investors with the currency and diversifying the market with a high quality issuer name. The issuances include green bonds and thematic bonds focusing on sustainable development and marine conservation, and attracted institutional and retail investors in the Americas, Asia, Europe and the UK.

The World Bank is supporting Indonesia’s capital market in a number of other ways, including by working with the government to develop the domestic green bond market. Milestone achievements in this area include the issuance of green bond regulations by the country’s Financial Services Authority, and issuance of the first corporate domestic green bond by state-owned enterprise PT Sarana Multi Infrastruktur. The World Bank is also assisting in the preparation of green bond impact reports for the bond, as well as for a green Sukuk issued by the government.

In parallel, the World Bank has partnered with the Indonesian Ministry of Finance to further enhance the country’s debt management capacity and increase the country’s resilience to financial shocks. The World Bank also helps countries build resilience against natural disasters and weather events by enabling access to insurance through the capital markets. In the last eighteen months, it has facilitated nearly US$ 2.35 billion of transactions—including for Caribbean countries, for the member countries of the Pacific Alliance (Chile, Colombia, Mexico, Peru), Pacific Island countries as well as provinces in the Philippines—through catastrophe bonds and swaps, including in local currency.

Arunma Oteh, World Bank Vice President and Treasurer, said: “We are grateful to the government of Indonesia for warmly hosting the Annual Meetings of the World Bank Group and the IMF this week in Bali. As we gather here to share ideas and opportunities for addressing the world’s most pressing challenges, we are glad to mark our first three months as an issuer of Indonesian rupiah bonds. It is also an opportune time to highlight Indonesia’s leadership in growing the domestic green bond market, and to build on our collaboration to build the country’s resilience to external shocks and other risks. Looking ahead, we hope to continue on our journey as we facilitate the flow of international investment to the country’s capital markets.”

About the World Bank

The World Bank issues between US$50-60 billion in Sustainable Development Bonds in the global capital markets every year, and proceeds of the bonds are used to support the financing of development programs that are aligned with its mission to end extreme poverty and boost shared prosperity and the Sustainable Development Goals. This includes, for example, projects that are helping to build liveable and sustainable cities amid unprecedented urban growth. World Bank projects are helping to finance improvements in water supply and sanitation, waste management, transport infrastructure and services, energy supply, and address challenges from climate change.

More information on World Bank bonds is available at www.worldbank.org/debtsecurities.

 

 


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