Global Green Bonds Issuance to Pass $1 Tn Mark in 2022

A survey by the Climate Bonds Initiative showed on Thursday investors’ expectations for the global green bond investment to double and reach $1 trillion for the first time in a single year by the end of 2022, Reuters reports.

The London-based non-profit body forecasts that green bond issuance this year will reach a record high of $500 billion, up from last year’s $297 billion.

According to CBI, that promotes investment in the low-carbon economy, investors are exerting growing pressure on corporations and financial institutions to improve their environment, social and governance (ESG) activities by issuing green bonds to raise money for low-carbon projects.

Green bonds are attracting attention and becoming increasingly popular despite the fact that they make up small fraction of the overall debt market since public and private sectors need trillions of dollars of capital to meet emissions-reduction targets.

CBI survey based on the responses from 353 companies, regulators, asset owners, investment managers, development banks as well as ratings and verification service providers and showed, a quarter of which, said the green bond investment would pass $1 trillion in the Q4 of next year.

A little less optimism was shown by 12% of respondents who said the milestone would be passed in the second quarter of 2023, 10% predicted the Q3 quarter of 2023 while 13% believe the 1 Tn mark will be past in Q4 of 2023.

Sean Kidney, chief executive of the Climate Bonds Initiative pointed that whether at the end of 2022 or during 2023, the long-awaited $1 trillion milestone is now a market reality, but stressed that in a situation in which the climate crisis grows, they must lift the bar much higher and to set a $5 trillion mark in annual green investment by 2025 for policymakers and global finance actors.

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