Pegasus Capital Advisors, a leading global private markets impact investment manager, has announced two major milestones: the passage of the Blue Green Bank Act and the signing of a funding agreement with the Green Climate Fund (GCF). These achievements mark significant progress in the establishment of the Blue Green Bank (BGB), an innovative finance vehicle aimed at enhancing climate resilience across Barbados and the wider Caribbean.
A New Financial Mechanism for Climate Resilience
The BGB is designed to address the urgent climate needs of small islands like Barbados, which face heightened vulnerability to rising sea levels and intensified weather events due to climate change. Barbados estimates that achieving climate resilience will require approximately USD 2 billion, or 40% of its GDP. The BGB offers a vital financial mechanism to channel investment toward local climate solutions and resilience.
“With the establishment and passage of the Blue Green Bank Act, additional flows of critical investment finance can now be channeled through various sectors, especially the energy, agriculture, tourism, social, and the blue and green sectors of the economy to assist creditors and investors, both private and public, in formulating more sustainable finance mechanisms to develop mitigation and adaptation resilient capacities, and to build and strengthen infrastructures through projects that are aligned to national priorities to respond to the very real challenges of climate change,” said Senator the Hon. Chad Blackman, LLB, LLM, ACIArb, Minister in the Ministry of Economic Affairs and Investment.
Support and Collaboration
Pegasus Capital Advisors has been actively involved in the creation and establishment of the BGB from the beginning and will be involved in its administration and oversight going forward. With support from the U.S. Agency for International Development (USAID), Pegasus Capital has accelerated the BGB’s operationalization, putting it on a faster path to channeling finance toward local climate solutions.
“These recent milestones to advance the Blue Green Bank are critical accomplishments that will help us increase climate resilience and economic stability in Barbados and beyond,” said Craig Cogut, founder, chairman, and CEO of Pegasus Capital Advisors. “The BGB will allow us to accelerate, scale, and replicate diverse investment models that deliver impactful change and ensure a sustainable and resilient future in Barbados.”
Empowering Climate Action
The GCF has played a pivotal role in supporting the establishment of the BGB. “The Barbados Blue Green Bank is a prime example of how the Green Climate Fund empowers countries to lead climate action. We are proud to partner with Barbados, USAID, Pegasus Capital, and The Rockefeller Foundation to create an institution poised to make a lasting impact on sectors such as energy and resilient housing as Barbados works toward ambitious climate goals, including a target of 100% clean energy by 2030,” said Mafalda Duarte, GCF Executive Director.
Leveraging Global Support
The BGB has garnered support from various international organizations and stakeholders. “This work marks an important step toward reforming global financial systems to provide more support and funding for countries to tackle climate change and pursue sustainable development,” said USAID Deputy Administrator Isobel Coleman in her keynote address at the Caribbean Investment Forum. “Funding from USAID, the Government of Barbados, and the Green Climate Fund is expected to leverage up to $210 million in private capital for green assets and climate projects that support the most vulnerable in Barbados and the wider Caribbean region – serving as a global model for climate-resilient investment.”
A Model for the Future
Dr. Rajiv J. Shah, President of The Rockefeller Foundation, emphasized the global significance of the BGB. “The government of Barbados and the Green Climate Fund’s innovation is the sort of people-centered climate solution the world needs today. Much like the Bridgetown Initiative, this bank may have started in Barbados, but it shows the world what’s possible and sets a model for ways to reverse the climate crisis while advancing opportunity especially for vulnerable people.”
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Addressing Immediate and Long-Term Needs
The approval of the BGB Act marks a transformative moment for Barbados and the wider Caribbean, establishing a pioneering financial institution to tackle climate change challenges through integrated development and investment banking. Initial capital for the BGB was secured through funding from the Green Climate Fund, USAID, and the Government of Barbados, with support from The Rockefeller Foundation. Originally conceptualized by Barbados Prime Minister Mia Mottley, the BGB aims to expand over time to the rest of the Caribbean.
The BGB will focus on financing projects that help with climate change mitigation and adaptation, including resilient housing, renewable energy generation, energy efficiency, water conservation, food security, and low-carbon transport. By engaging banks, credit unions, pension funds, and insurance companies, the BGB strives to accelerate the implementation of sustainable solutions and reinforce Barbados’ capacity to mitigate climate risks and build a more resilient future.
In conclusion, the establishment of the Blue Green Bank marks a significant step forward in addressing the urgent climate needs of Barbados and the Caribbean. Through innovative financing and strong international collaboration, the BGB aims to enhance climate resilience and ensure a sustainable future for the region.
