Beyond USD7tn: A record quarter shows the strength of the GSS+ market

In the first half of 2026, sustainable debt has passed USD7tn in cumulative aligned volume, supported by the strongest green bond quarter on record, demonstrating the market’s strength and resilience. But financing the climate transition requires this level of activity to grow, and to grow quickly.

Our Sustainable Debt Global State of the Market H1 2026 report examines the progress behind the headline figures. Record European issuance, China’s developing green finance market, and more than 200 debut issuers show how sustainable debt is attracting participation and funding investment.

The challenge now is to accelerate. Clean energy, resilient infrastructure, and industrial transition need capital at a much greater scale. This report shows where progress is taking shape and what supports further market development.

A record quarter delivers net market growth

Green bonds led activity in the first half of 2026. Issuers priced USD210.8bn in aligned green debt during Q2, the label’s strongest quarter on record. First-half green volume reached USD364.1bn, its second strongest first half.

Across green, social, sustainability, and sustainability-linked debt, collectively GSS+, aligned H1 issuance reached USD529.7bn. Q2 contributed USD288.5bn, making the quarter the third strongest on record for the wider market.

Green bonds accounted for 69% of aligned first-half volume. Their quarterly record demonstrates the continued role of green use-of-proceeds financing within sustainable debt.

Issuance also exceeded repayments. With USD257.1bn of debt maturing during H1, the market added USD272.6bn in net aligned volume. For investors following the available supply of sustainable debt, this shows expansion beyond the replacement of maturing instruments.

A broad issuer base

Market strength also depends on who participates. During H1, 941 issuers contributed to the GSS+ market, including more than 200 debut issuers.

Financial corporates supplied 23% of aligned volume, followed by government-backed entities at 21%. Development banks and non-financial corporates each contributed 19%.

Financial corporates recorded their strongest quarter, issuing USD76.3bn in Q2. Development banks delivered their second strongest first half, with USD101.7bn.

This mix gives investors several routes into sustainable debt, spanning public institutions, financial firms, and businesses financing their operations and investments.

Credibility is central to market development. Cumulative aligned volume reached USD7.3tn, representing 83% of all GSS+ debt recorded by Climate Bonds. These instruments meet our dataset methodologies. The assessment looks beyond the label to the requirements for each debt theme.

Europe sets issuance records

Europe’s first-half performance shows the scale established sustainable debt markets now deliver.

Euro-denominated aligned GSS+ issuance reached USD280.5bn, its strongest half-year result and 6% above the previous record set in 2021. France led national aligned GSS+ issuance with USD81.3bn, including a record USD44.0bn in Q2. Germany followed with USD60.9bn, recording its strongest first and second quarters.

These figures describe two aspects of market activity: the euro’s role as a financing currency and the contribution of French and German issuers.

Governments played a substantial role. European sovereigns supplied 72% of aligned sovereign volume, with France issuing USD16.8bn and Germany USD13.4bn.

France also priced a EUR10bn green bond, the largest single-tranche GSS+ deal on record when converted into US dollars. Transactions of this size demonstrate the contribution sovereign programmes bring to sustainable debt supply.

China: policy support translates into market development

By the end of H1 2026, China had reached USD729bn in cumulative aligned GSS+ volume, making China the third-largest national source globally. During the first half, China ranked second among national sources of aligned green bonds.

Chinese issuers priced USD46.1bn in aligned GSS+ debt across 212 deals. Green bonds accounted for 96%.

The report links China’s market development to supportive national policy, increasingly unified standards, and stronger incentives and assessment mechanisms.

The Green Finance-Supported Projects Catalogue, implemented in October 2025, unified green project identification standards across products including bonds and loans. More consistent definitions help investors compare eligible activities across instruments.

Financing energy, transport, and water

China’s issuance figures become more meaningful when connected to the activities receiving finance.

Energy and transport together accounted for 69% of the use of proceeds from aligned Chinese green bonds in H1. Water became the third-largest sector at 12%.

Policy banks were prominent issuers. The Agricultural Development Bank of China contributed USD9.3bn in aligned green issuance, while China Development Bank contributed USD4.1bn. Battery manufacturer CATL followed with USD3bn.

These examples connect sustainable debt with infrastructure, agricultural development, and industrial investment. They also show the different types of issuers participating in China’s market.

It’s now only a matter of speed

The next task is to translate these strengths into more financing for climate action. Governments need investment pipelines. Banks and companies need credible projects and transition plans. Investors need a larger supply of assets meeting clear standards.

The market has demonstrated its capacity to finance the transition. Meeting the climate challenge now requires sustained investment at a much greater scale and speed.

Read the full Sustainable Debt Global State of the Market H1 2026 report on the Climate Bonds website for the data, methodology, and China spotlight.

‘Til next time!

Climate Bonds