Green bond issuance in emerging markets rose by 34% in 2023, reaching $135 billion, up from $101.2 billion in 2022. Financial institutions were the largest issuers, using most of the proceeds to finance sustainable energy, buildings, and transportation.

Amundi, a major asset manager, and the International Finance Corporation (IFC) revealed these figures in a report published on May 22, 2024. For the second consecutive year, financial institutions led green bond issuance in emerging markets in 2023. They were followed by states and corporations, although the latter two reduced their green bond issuance by 32% and 21%, respectively.

China remained the dominant issuer among emerging markets, a position it has held since 2012. Sub-Saharan Africa ranked last in green bond issuance. Most of the funds raised through these green bonds were allocated to renewable energy projects (37.6% of total funds), sustainable buildings (29.4%), water projects (12.5%), and transportation (11.7%).

"To achieve these goals, substantial efforts must be made to ensure continued growth in the global green, social, sustainability, and sustainability-linked bonds market, including enhancing regulations and standardizing best practices," commented Susan Lund, IFC's Vice President of Economics and Private Sector Development.

The report also projected continued growth in green bond issuance in emerging markets through 2025, with an expected annual growth rate of 7.5%. This growth will be driven by factors such as the acceleration of the energy transition, competitive pricing advantages for issuers compared to developed markets, and favorable macroeconomic conditions.