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Emerging Market Green Bonds Report 2023

by Madaline Dunn

European asset manager Amundi and the IFC, a member of the World Bank Group, have published the sixth edition of the Emerging Market Green Bonds Report.

The report provides insight into the developments in the green bonds market for emerging markets and developing economies (EMDEs). 

The report found that the overall market for sustainable finance in EMDEs staged a rebound in new debt issuance during 2023 on the back of lower inflation expectations.

Specifically, it highlights a strong rebound in GSSS bonds issuance globally (up by 11 per cent, after a 10 per cent retreat in 2022), driven by green bonds (up 15 per cent) as well as by emerging markets (up 45 per cent), reaching $1 trillion to match the all-time high seen in 2021.

Meanwhile, in emerging markets, strong GSSS bonds issuance was seen across all sub-segments (up by 45 per cent overall in emerging markets and 65 per cent in EMDEs outside China). 

Further, it shared that China’s strong but relatively slower GSSS bonds issuance (up by 28 per cent) was driven by a combination of two factors:

  • Some reversion from a “remarkably” strong 2022, and 
  • Weaker domestic economic dynamics, particularly in the construction and real estate sectors.

In EMDEs outside China, GSSS bonds issuance was mainly driven by green bonds, which increased by 81 per cent. 

In the Middle East and North Africa, most notably UAE and Saudi Arabia, green bonds issuances more than doubled.

Non-financial corporates remained the largest green bonds issuers in developed markets (36 per cent of the total), while financial institutions dominated in emerging markets (58 per cent of the total). 

Meanwhile, green bonds issuance by sovereigns grew strongly: 33 per cent globally and 226 per cent in emerging markets.

The largest share of funds raised from the green instruments in EMDEs during 2023 was allocated for renewables, at 37 per cent. 

The next biggest allocation was for green buildings claiming 29 per cent of the total from 9 per cent a year earlier.

Read the full report here.

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