Breaking Barriers for a Greener Future:
Climate Bonds CONNECT 2023 lands in Colombia
Latest numbers and trends in green finance highlighted in new LAC State of the Market report
BOGOTA, 18/07/23, 11AM: Building upon the triumph of the previous eight years of annual conference series, the Climate Bonds CONNECT 2023 Latin American and the Caribbean Regional Conference is delighted to announce that it has landed today at the vibrant city of Bogota, Colombia. With a lineup of distinguished speakers and thought-provoking discussions, the in-person-only event is a dynamic platform for knowledge exchange, innovation, and collaboration.
As a frontrunner in climate finance within the region, Colombia has achieved remarkable progress towards its goals. The country has implemented a robust Green Taxonomy and enacted progressive public policies that incentivize green investments. Climate Bonds CONNECT 2023 offers a unique opportunity to witness Latin America’s dedication firsthand and connect with like-minded professionals, forge new partnerships, as we engage with local stakeholders, policymakers, and financial institutions who are leading the charge towards a greener economy.
Drawing inspiration from this year's captivating theme, "Ready. Set. Transition.", the Climate Bonds CONNECT 2023 conference delves into this transition, exploring the power of sustainable finance in driving economic growth, mitigating climate risks, and fostering resilience. The event explores groundbreaking initiatives and strategies that will accelerate the transition towards a low-carbon economy.
We are honored to have the support and sponsorship of esteemed organizations that share our vision for a sustainable future. The event is proudly sponsored by Scotiabank Colpatria, Inter-American Development Bank, S&P Global Ratings, LAGreen Fund, Ambire Global and supported by Bolsa de Valores de Colombia, Saving the Amazon and UN Colombia, who are at the forefront of climate action in the country.
Latin America and Carribean State of the Market 2022
The Climate Bonds Initiative and the Inter-American Development Bank Group (IDB) pre-launched the latest "Latin America and Caribbean (LAC): State of The Market 2022" report at the Conference. The green, social, sustainability, sustainability-linked, and transition (GSS+) bond markets in LAC have experience sustained growth since their inception in 2014.
Key findings:
- Despite a contraction in volumes in 2022, the GSS+ segment maintained its 5% share of global debt capital markets, with the GSS+ market in LAC accounting for an impressive 21% on average of the region’s debt. This reflects the vulnerability of LAC economies to the impacts of climate and social-ecological interdependencies, and the need for substantial investment in transition technologies.
- In 2022, labelled instruments accounted for 25% of the USD40.8bn from the region. However, persistent financial barriers for the local capital markets remain (e.g., currency risk, lack of liquidity and project risks), and the LAC market is the source of only 4% of global GSS+ debt.
- By the end of 2022, cumulative green, social, and sustainability debt originating from LAC had reached USD126.8bn, a 160% increase since June 2021 (USD48.6bn). Transition and sustainability-linked bonds, included for the first time in this regional analysis, add a further USD27.3bn. By the end of 2022, the LAC GSS+ market had reached USD154.1bn.
Labelled bonds
- The sustainability label accounts for 35% of the GSS+ market, with USD54.4bn. The largest sustainability bond issuers in the region are the supranational IDB Group with cumulative volume of USD14bn, and the Mexican Government, with USD7.7bn. In 2022, Mexico had the largest sustainability bond market in the region with cumulative issuance of USD17.8bn mostly from sovereign bonds (43%) and government-backed deals (26%).
- Green is the second largest label, with cumulative volume of USD42.4bn by the end of 2022, and 40% growth over the last 2.5 years. Non-financial corporate issuers made the largest contribution (53%) followed by sovereigns (19%). The largest green issuer was the Chilean Government with four deals worth USD7.4bn, and the country has the second largest green bond market in the region (USD12.7bn). The largest green market in the region is Brazil (totalling USD15.2bn spread out over 86 bonds), which also has the largest number of bonds outstanding.
- The social label experienced the most remarkable growth, recording an increase of 247%, with volumes reaching USD29.9bn by the end of 2022, compared with USD8.6bn in June 2020.
Sovereign bonds
Since Climate Bonds’ Latin America and Caribbean (LAC): State of The Market 2021, three new countries have joined the Sovereign GSS+ Bonds Club and volumes in the region reached a cumulative USD49.9bn across 30 green, social, sustainability and sustainability-linked sovereign deals.
LAC countries have embraced sovereign GSS+ issuance, with a cumulative USD49.9bn at the end of 2022, a 442% increase on the USD9.2bn that had been recorded in June 2020. Chile is a GSS+ bond market pioneer and as of mid-2023 was the only sovereign to have issued across the green, social, sustainability, and SLB themes, for total volume of USD34.5bn. The activity of issuing a thematic deal sends a signal to the market that the government is committed to transition, which attracts crowding in from the private sector.
|
LAC Sovereigns |
Total amount issued |
Number of deals |
|
|
Green (16%) |
Chile |
USD 7.4bn |
4 |
|
Colombia |
USD 549.4m |
4 |
|
|
Social (39%) |
Chile |
USD 18.5bn |
12 |
|
Ecuador |
USD 400m |
1 |
|
|
Guatemala |
USD 500m |
1 |
|
|
Sustainability (38%) |
Chile |
USD 6.5bn |
4 |
The report will soon be available at www.climatebonds.net/resources/reports
Upcoming Climate Bonds CONNECT 2023 series of events:
- New York (20 September): in-person only
- London (9 &10 November): hybrid
Be part of the change. Register your interest now at https://cutt.ly/Mwoaz6gZ
For more information, please contact:
Luiza Mello
Communications Senior Specialist
T: +55 (61) 98209 8126
E: luiza.mello@climatebonds.net
Notes for journalists:
About Climate Bonds Initiative: Climate Bonds Initiative is an international not-for-profit working to mobilise global capital for climate action. Climate Bonds undertakes advocacy and outreach to inform and stimulate the market, provides policy models and government advice, market data and analysis, and administers an international Standard & Certification Scheme for best practice in green bonds issuance. 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, and is one of the world’s largest banking and financial services organisations.
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