Scaling Blue Bonds for the Global South: Reforming Markets for Ocean Finance

(Priya Noronha – Observer Research Foundation) Blue bonds have emerged as a credible instrument for mobilising finance for sustainable ocean-related development, including marine conservation, climate resilience, and the broader blue economy. Cumulative global issuance reached US$ 15.25 billion by mid-2025, more than doubling year-on-year and registering the fastest growth across any sustainable bond category. Yet their scale remains elusive. At just 0.24 percent of the broader sustainable bond market, the blue bond asset class remains thin and fragmented. Reaching the projected US$ 70 billion market by 2030 will require resolving supply- and demand-side constraints simultaneously. On the supply side, limited pipelines of investment-ready projects, institutional and technical capacity gaps, and elevated perceptions of credit risk continue to constrain the issuance of blue bonds. On the demand side, exclusion from major bond indices and weak benchmarking frameworks continue to limit investor participation, while substantial pools of domestic capital remain untapped. Unlocking their potential will require coordinated reforms in market design, risk mitigation, and local capital mobilisation. – Scaling Blue Bonds for the Global South: Reforming Markets for Ocean Finance