Blue bonds are a kind of debt that helps countries preserve natural resources : The Indicator from Planet Money Low- and middle-income countries are facing the worst consequences of the climate crisis, and rising global interest rates are making it harder to repay their debts. What if there was a way to solve both problems at once?For sponsor-free episodes of The Indicator from Planet Money, subscribe to Planet Money+ via Apple Podcasts or at plus.npr.org.

Blue bonds: A market solution to the climate crisis?

Blue bonds: A market solution to the climate crisis?

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Randy Brooks/AFP via Getty Images
The Prime Minister of Barbados, Mia Amor Mottley, speaks during the National Honors ceremony and Independence Day Parade at Heroes Square in Bridgetown, Barbados, on November 30, 2021. (Photo by Randy Brooks / AFP) (Photo by RANDY BROOKS/AFP via Getty Images)
Randy Brooks/AFP via Getty Images

The climate crisis is having a disproportionate effect on low- and middle-income countries. Many of these nations are being hit with a double whammy: They're suffering the most severe environmental damage from global warming, and rising global interest rates are making it harder for them to repay their debts.

So-called blue bonds are a financial tool that aim to tackle both problems. They help refinance countries' debt while also freeing up funds to preserve their most treasured resources. In this episode of our climate series, we see how blue bonds were used in Barbados.

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