Sovereign social bond proposal paper

The deepening coronavirus crisis requires innovative interventions to address the funding gaps resulting from requirements to address its devastating economic consequences.

Intellidex’s head of capital markets research, Peter Attard Montalto, and executive chair Stuart Theobald, in collaboration with the Covid-19 Economy Group, propose that government should issue a special sovereign social bond to help fill the funding gap created by the need to address the socioeconomic consequences of the pandemic.

They argue that the South African government could become one of a few sovereigns to issue a social bond to be used to fund the fight against the Covid-19 crisis, setting out details on the model and structure of such a bond in a proposal paper.

This could make a significant contribution to government’s funding gap, with funding raised at a relatively low cost while also diversifying government’s investment base to include ESG funds.

Access the proposal paper here.