Green bonds are bonds issued to raise finance for projects with environmentally sustainable benefits. Global green bond issuance reached USD155.5bn in 2017, an increase of over 78% from 2016. China is one of the leaders in green bond issuances, reaching USD36.4bn in 2017.
Green bond issuers in the Eurobond market commonly comply with the voluntary Green Bond Principles. In China, green bonds are regulated and approvals must be sought prior to issuance, although certain incentives are given to issuers to develop this market.
Other regulators have also recently introduced green bond initiatives (e.g. green bond listing platforms in London and Luxembourg and green bond grant schemes in Hong Kong and Singapore).
Watch our short, 3-minute, animation for further information on green bonds.