The briefing examines Hong Kong's burgeoning green bond market which is underpinned by government’s push and incentives. While the first green bond was issued in 2016, Hong Kong's market picked up pace in 2018 following a series of policy signals and measures announced by the government in late 2017. These aimed to promote green finance development by creating liquidity, supporting integrity and providing incentives for green bonds. In October 2017, the Chief Executive of the Hong Kong government included green finance agenda in the Policy Address, followed by the government’s announcement in early 2018 to issue sovereign green bonds. The HKD100bn (USD12.8bn) Hong Kong Government Green Bond Programme is one of the world’s largest.
While the Hong Kong green bond market saw encouraging signs of development in 2018, it is just a curtain raiser for accelerated green finance in the transition to a low-carbon economy at speed and scale. The briefing identifies the following factors as most conducive to supporting further market growth and bolstering Hong Kong’s position as an Asian green finance hub.
- Labelling the 'unlabelled' bonds of climate aligned issuers green
- Channeling international capital into mainland China
- Greening of Bond Connect
- Set an example with sovereign green bond issuance