Green Infrastructure Investment Opportunities
Guangdong-Hong Kong- Macao Greater Bay Area 2021 Report
London/Hong Kong: 24 June 2021: 09:00 GMT+7: Climate Bonds Initiative has released the Green Infrastructure Investment Opportunities – Greater Bay Area (GIIO GBA) report, assessing the state of the market for green infrastructure projects in the GBA; one of the economic growth engines and leading green finance regions in China.
Produced with the support of HSBC, the report identifies trends and opportunities, analyses major green infrastructure projects and outlines actions to promote the development of green finance and investment. It aims to facilitate greater engagement between project owners and developers, and institutional investors in the GBA, which consists of nine cities in the Guangdong Province, and two special administrative regions, i.e., Hong Kong and Macao.
The report highlights that the major infrastructure projects in the 14th Five-Year-Plan (FYP) of Guangdong Province are expected to have a total investment of RMB5tn (USD776.9bn), of which green infrastructure investment is not less than RMB1.9tn (USD299bn), including rail transit, wind power, modern water conservancy, ecological civilization construction and new infrastructure construction. Along with the infrastructure planned in Hong Kong and Macao, the GBA presents immense opportunities for international investors who are eyeing onshore green assets.
The report showcases 18 green projects in renewable energy, low carbon transport, water infrastructure, waste management, green buildings and new infrastructure, and identifies a pipeline of seventy (70) projects in these six categories. Green debt instruments have been increasingly deployed in GBA’s infrastructure financing.
The GBA GIIO report is the first in the GIIO series to explore the investment opportunities in the new infrastructure sector, which is part of China’s post-COVID-19 relief package, and it refers to information-based infrastructure (5G, artificial intelligence and blockchain), converged infrastructure - supported by applications of new technologies (smart transportation and smart energy) as well as innovative infrastructure that supports scientific research, technology, and product development.
Unlocking the immense green infrastructure investment opportunities in the GBA
The report also highlights six recommendations to develop green finance and investment for infrastructure projects in the GBA :
- Promoting green securitisation
- Promoting the issuance of local government green bonds
- Leveraging Hong Kong's capital market to support infrastructure development in the GBA
- Harmonisation of green definitions for various sectors
- Improving project visibility
- Paving the way to green recovery with green infrastructure
Hui Feng Zhang, Head of Corporate Sustainability HSBC Asia Pacific:
“Sustainable Finance is key to a low carbon future. As an up-and-coming economic powerhouse, GBA has made great progress in green finance over the past few years, with demand for green infrastructure investment at all-time high.
As the leading bank in the sustainable finance market, HSBC has been at the forefront of helping businesses transit to low carbon emissions. With GBA as one of our strategic focuses, we will continue to collaborate closely with relevant stakeholders in the vibrant city cluster to promote sustainable development and continue our ongoing efforts in driving green finance innovation.”
Sean Kidney, CEO, Climate Bonds Initiative:
“The Greater Bay Area holds enormous potential for green development, investment and infrastructure opportunities for domestic and international investors. As a growing regional green finance hub, the GBA can foster and facilitate new financial flows and market development to deliver capital for low carbon infrastructure projects. Leveraging government support and market mechanics are amongst the report recommendations and will be crucial in unlocking this potential and funding low carbon economic development.”
The report can be downloaded here.
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Acknowledgement: The Greater Bay Area Green Infrastructure Investment Opportunities Report is produced with the kind support of HSBC, and the input from The Hong Kong Monetary Authority, the Green Finance Committee of Guangdong Society for Finance and Banking, and China Emissions Exchange.
Notes for Journalists:
About Climate Bonds Initiative: The Climate Bonds Initiative is an investor-focused not-for-profit, promoting large-scale investment in the low-carbon economy. It undertakes advocacy and outreach to inform and stimulate green bond markets, provides policy models and government advice, international development programs, market data and analysis and administers the Standards & Certification Scheme. For more information, please visit www.climatebonds.net.
About The Hongkong and Shanghai Banking Corporation Limited: The Hongkong and Shanghai Banking Corporation Limited is the founding member of the HSBC Group. HSBC serves customers worldwide from offices in 64 countries and territories in its geographical regions: Europe, Asia, North America, Latin America, and Middle East and North Africa. With assets of $2,959bn at 31 March 2021, HSBC is one of the world’s largest banking and financial services organisations.