Amundi: EM Green Bond Sales Fall Amid China Retreat
The issuance of green and various sustainability bonds fell in emerging markets mainly due to a decline in China which saw investors opted for other fixed income assets, according to a report by Amundi.
The issuance of green, social, sustainability, and sustainability-linked (GSSS) bonds in emerging markets fell 14 percent year-on-year in 2024, according to the «Emerging Market Green Bonds Report 2024» by Amundi and International Finance Corporation (IFC), a World Bank Group member.
This was mainly attributable to lower issuance in China as local borrowers shifted to conventional bonds in the onshore market. Another factor was a 23 percent contraction in overall fixed income issuance in emerging markets outside China in the midst of weaker economic growth in Asia and Europe.
While the global market continued its rise with GSSS bond issuance reaching an all-time high of over $1 trillion, the asset class’ share of fixed income as a whole decreased from 2.5 percent to 2.2 percent.
Increasing Diversification
Although green bonds have historically dominated GSSS emerging market issuance, which totaled around $800 billion between 2018 and 2024, there is a growing shift toward sustainability bonds.
«This trend is pronounced among multilateral institutions and, more generally, among issuers outside China that are seeking the flexibility of sustainability bonds to finance both environmental and social projects,» said Yerlan Syzdykov, Amundi’s global head of emerging markets.
