+
Sustainable bond market contracts is down 19% from Q1
ECONOMY & POLICY

Sustainable bond market contracts is down 19% from Q1

Moody's Ratings reported a decline in global sustainable bond issuance for the second quarter of 2024. The total issuance reached $238 billion, which represents a 20% decrease from the previous year and a 19% drop from the first quarter of this year. In the first half of 2024, cumulative issuance across five labeled categories amounted to $534 billion, marking an 8% decline from the $581 billion recorded in the same period of 2023.

The breakdown of the issuance includes $146 billion in green bonds, $39 billion in social bonds, $41 billion in sustainability bonds, $8 billion in sustainability-linked bonds, and $3 billion in transition bonds. Despite this decline, Moody's projected that the sustainable bond market could still meet the forecast of $950 billion for 2024 and potentially reach $1 trillion in annual issuance.

The report also noted a significant reduction in the number of new issuers, which has decreased by over a third annually since peaking in 2021. This reduction is attributed to heightened scrutiny from market regulators and concerns about greenwashing, which could be constraining market growth.

Additionally, the market for sustainable loans experienced a 29% drop, falling to $286 billion from $402 billion in the first half of 2023. Most of this segment consists of sustainability-linked loans, which have been impacted by issues related to missed targets and greenwashing concerns.

In response to these developments, the International Capital Market Association (ICMA) has released new guidance documents aimed at supporting green enabling projects and sustainability-linked loans. These updates emphasize a greater focus on transition finance, structural innovation, and improving the sustainability quality of financial instruments.

Moody's Ratings reported a decline in global sustainable bond issuance for the second quarter of 2024. The total issuance reached $238 billion, which represents a 20% decrease from the previous year and a 19% drop from the first quarter of this year. In the first half of 2024, cumulative issuance across five labeled categories amounted to $534 billion, marking an 8% decline from the $581 billion recorded in the same period of 2023. The breakdown of the issuance includes $146 billion in green bonds, $39 billion in social bonds, $41 billion in sustainability bonds, $8 billion in sustainability-linked bonds, and $3 billion in transition bonds. Despite this decline, Moody's projected that the sustainable bond market could still meet the forecast of $950 billion for 2024 and potentially reach $1 trillion in annual issuance. The report also noted a significant reduction in the number of new issuers, which has decreased by over a third annually since peaking in 2021. This reduction is attributed to heightened scrutiny from market regulators and concerns about greenwashing, which could be constraining market growth. Additionally, the market for sustainable loans experienced a 29% drop, falling to $286 billion from $402 billion in the first half of 2023. Most of this segment consists of sustainability-linked loans, which have been impacted by issues related to missed targets and greenwashing concerns. In response to these developments, the International Capital Market Association (ICMA) has released new guidance documents aimed at supporting green enabling projects and sustainability-linked loans. These updates emphasize a greater focus on transition finance, structural innovation, and improving the sustainability quality of financial instruments.

Related Stories

Gold Stories

Next Story
Infrastructure Transport

97 Per Cent Of Rongjeng-Mangsang-Adokgre Road Nears Completion

Deputy Chief Minister in-charge of public works Prestone Tynsong said in Shillong on 26 August that 97 per cent physical progress had been achieved on the ongoing Rongjeng-Mangsang-Adokgre road being constructed under the Non-Lapsable Central Pool of Resources (NLCPR). He noted the project was sanctioned in 2017 and that the stipulated time for completion had been 24 months from issue of the final work order. The deputy chief minister informed the assembly that the government had decided to include the remaining work under a World Bank project. In reply to a query from Rongjeng MLA Jim M Sangm..

Next Story
Infrastructure Transport

First TBM Starts Digging Five Point Three Kilometre Tunnel Under SGNP

The Goregaon-Mulund Link Road (GMLR) Phase three (B) project has reached a key milestone as the first tunnel boring machine (TBM) began excavation of the first of two tunnels beneath the Sanjay Gandhi National Park (SGNP). The machine, named Tulsi, started cutting a five point three kilometre bore that will link Dadasaheb Phalke Chitranagari in Goregaon East with Amar Nagar in Mulund West. Officials issued a statement noting the commencement of tunnelling work under the protected green belt. The twin tunnels are being constructed using mechanised tunnelling methods that aim to limit surface di..

Next Story
Infrastructure Transport

UP Approves Two Expressways And Rs 240 bn Infrastructure Push

The Uttar Pradesh Cabinet approved a series of infrastructure and industrial investment proposals totalling Rs 240 billion (Rs 240 bn), including two major expressway projects, a manufacturing and logistics cluster in Sultanpur and incentives for 11 industrial projects across the state. The decisions, taken at a meeting chaired by Chief Minister Yogi Adityanath, underline the state government’s focus on expanding road connectivity around emerging industrial hubs while attracting manufacturing investment to districts beyond major urban centres. The approvals cover both greenfield expressway c..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code