Hong Kong sells US$3 billion of green bonds, pricing its first euro tranche to sharpen city’s edge as centre for sustainable finance

The entire offering of eurobonds and dollar-denominated debt was triple the size of first US$1 billion green bond sold in 2019 and outpaced the US$2.5 billion of 30-year green bond priced in January.

The 20-year tranche of the latest offering was the longest euro-denominated green bond issued by an Asian government, according to the Hong Kong Monetary Authority (HKMA), the city’s de facto central bank. It underscores the city’s HK$175.5 billion (US$22.5 billion) plan for green bonds over the next five years as Hong Kong strives to become an international green financial centre. The government has gone to market with three green bonds since first announcing its green bond programme in 2018.

“The inaugural euro-denominated offering has also allowed us to reach out to a new group of investors, drawing their attention to the sustainability journey of and financial opportunities in Hong Kong, providing momentum for further growth of our financial market,” the Financial Secretary Paul Chan Mo-po said in a news release.

Green bonds are fixed-income financial products designed to fund projects that are environmentally friendly.

Hong Kong plans to increase the use of wind, waste-to-energy and solar power to generate electricity in the coming years, part of the push to reach carbon neutrality by 2050, according to the special administrative region’s (SAR) latest climate action plan unveiled in October.