Ministry of Finance of China (MOF) just officially released first government green bond of this country, mobilize 6 billion yuan (equivalent to approx 824 million USD) to finance environmental projects and initiatives. Goals include: climate change mitigation and adaptation, conservation of natural resources and biodiversity.
New bond lot includes 3 year and 5 year terms released on London Stock Exchange (LSE) – marking is not just China's first government green bond, but also the first time this country Listing government green bonds on an international market.
Decision to list in London comes after visit by UK finance minister Rachel Reeves to Beijing earlier this year, to promote financial and economic cooperation between Britain and China.
After announcing the issuance plan, the Chinese Ministry of Finance announced The first government green bond framework by February 2. It clearly states the following goals:
Show national commitment for green and sustainable development
Diversifying the global green bond market
Encourage more domestic issuers to participate in the green market
Attracting investment for green finance sectors
This framework also provides for the Eligible spending categories Using capital from green bonds, including:
Clean Transportation
Sustainable water and wastewater management
Management and restoration of natural resources, land and biodiversity
Protect and restore marine ecosystems
Pollution prevention and control
Recycling and resource utilization
The issue received a huge amount of attention, with total subscription volume reaching 47 billion yuan, many times the offering value.
London Stock Exchange (LSE) said in a statement after the release:
“This event is an important step forward in the internationalization of the RMB and demonstrates China's commitment to promoting green and sustainable development.”