Singapore will issue its first green sovereign bond as part of a plan to access the market for USD26bn by 2030 to fund environmental projects, as reported by Bloomberg on February 18. According to a Finance Ministry official, this is an increase over last year’s plans to generate SGD19bn (USD14.13bn) in green debt in order to fund more projects. The new bonds’ currency and other characteristics will be revealed closer to the issue date.
According to the Institute of International Finance (IIF), the world will require approximately USD4tr per year to address the issues of climate change. To fill this financial gap, bond investors will have to put up more cash. Global ESG bond issuance is expected to reach USD4.5tr annually by 2025, roughly three times the present annual issuance volume. Around half of the global ESG bond market is now made up of green bonds. Green bond issuance totaled more than USD1.1tr by the end of October 2021. In addition, the issuance of ESG bonds in emerging markets is predicted to increase from USD50bn in 2020 to USD360bn in 2023. With a goal of becoming carbon neutral by 2060, China is likely to continue to dominate developing market issuance, accounting for more than half of all issuances through 2023.