The World Bank Group ( through the International Bank for Reconstruction and Development) has priced a $120 million Spekboom Restoration Outcome Bond, its longest-dated outcome bond to date, maturing in November 2040. The issuance aims to support large-scale ecosystem restoration and job creation in South Africa’s Eastern Cape province through the planting and management of spekboom, a native succulent plant known for its drought resilience and exceptional carbon sequestration capabilities.
Spekboom restoration is expected to improve soil quality, enhance water retention, boost climate resilience, and help revive biodiverse ecosystems that support other plant and animal species. The bond structure mobilizes $25 million in private capital to scale up a 50,000-hectare restoration project designed, developed, and operated by Imperative, a specialist in ecosystem restoration. The initiative targets the rehabilitation of degraded land while creating approximately 11,000 local jobs, including opportunities through small and medium-sized enterprises involved in planting, harvesting, monitoring, and ongoing land management. Investors benefit from full principal protection backed by the World Bank’s AAA credit rating. The $120 million in proceeds will support the World Bank’s sustainable development lending activities worldwide. Bondholders will receive a fixed coupon of 2.410% per annum (with a short first coupon), which is lower than the yield on comparable standard World Bank bonds. The difference is directed—via a hedge transaction with BNP Paribas—as upfront financing for the spekboom project.
Additional returns are linked to project outcomes. Amazon has entered a fixed-price offtake agreement to purchase a large share of the carbon removal units (CRUs) generated by the project over more than a decade. A pre-determined percentage of the revenue from these CRU sales will be channeled back to investors through BNP Paribas as CRU Linked Interest, with potential further upside from performance-based payments. This structure offers investors the possibility of higher overall returns compared to a standard World Bank bond of similar maturity if the restoration project meets or exceeds expectations. BNP Paribas acted as the sole Lead Manager and Bookrunner for the transaction. The bond is listed on the Luxembourg Stock Exchange. Trade date was April 23, 2026, with settlement scheduled for April 30, 2026. The interest structure includes a fixed component plus potential CRU-linked interest (starting from November 2, 2031), shortfall catch-up, planting success, and outperformance payments. Redemption is at par.
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