China cements position as leading green bond market, US$37.1 bn issued in 2017

LONDON -  Climate Bonds Initiative and China Central Depository & Clearing Co. Ltd (CCDC), with the support of HSBC, today released the China Green Bond Market 2017 report, showing that total green bond issuance from China reached US$37.1 billion (RMB248.6 bn) in 2017, a 4.5% increase on the previous record-breaking year.

This secures China’s place as the second-largest green bond market in the world.

The report says a continuing focus on environmental challenges by the Chinese Government has been

reflected by development in the green bond market, regulatory reforms, momentum at the local level and a diversification of issuer types and use of proceeds.

The 2017 highlights:

• 118 green bonds were issued during 2017 (113 onshore, 5 offshore);

• US$37.1bn (RMB248.6bn) green bonds were issued, of which 62%, US$22.9bn (RMB 154.3bn) aligned with international definitions;

• US$6.01bn (RMB40.2bn) of issuance was Climate Bonds Certified, including the US$2.15bn debut green bond from Industrial & Commercial Bank of China (ICBC), the

worlds’ biggest bank; and

• The largest cumulative issuer in the year was China Development Bank (CDB)’, which included a Climate Bonds Certified offshore bond of US$1.67bn (RMB 11.1bn).

The report says that to play its part in reaching the global US$1 trillion milestone by 2020, the Chinese market needs

to achieve 10-fold growth in green bond issuance in the next three years.

The report outlines five catalysts for growth, including:

• A greener Belt and Road Initiative;

• Increasing green sovereign and sub-sovereign issuance;

• Inter-country capital flows supporting green bond market growth;

• A growing role for Hong Kong; and

* A ‘Green Bond Connect’ to help international investors invest in China’s domestic market.

 www.climatebonds.net www.chinabond.com.cn www.hsbc.com  (ATI).