Green, social and sustainable bonds set to plug climate financing gap

IN RECENT years, the market for sustainable use-of-proceeds bonds has grown significantly. Annual issuance of green, social and sustainable (GSS) bonds rose from US$95 billion in 2018 to US$735 billion in 2021, according to Bloomberg data.

However, the sustainable-labelled bond industry had a difficult 2022 amid broader macroeconomic issues, causing annual issuance of GSS bonds to fall to US$572 billion.

The energy crisis, pandemic and last year’s interest-rate hikes created a challenging macroeconomic environment, exacerbated by the war in Ukraine.