ASEAN Green bonds market poised for growth

Published February 9, 2020, 12:00 AM

by manilabulletin_admin


The Securities and Exchange Commission believes that the Green and Sustainability debt markets in the Philippines and other members of the Association of Southeast Asian Nations (ASEAN) are poised for growth, with the “necessary foundations” for their development in place.

In a keynote speech at the ASEAN+3 Bond Market Forum Meeting at the Asian Development Bank (ADB) Headquarters in Manila, SEC Commissioner Ephyro Luis B. Amatong cited the “notable” issuances of bonds worth more than $3.8 billion under the ASEAN Green and Sustainability Bond Standards in 2019 as positive indication of the market’s development.

Last year’s issuances amounted six times more than the $639 million issued in 2018, when the value increased by over 50 percent from 2017.

Sustainability bonds accounted for $1.4 billion or 36 percent of last year’s total, up 14 times from just $100 million in 2018.

“While ASEAN may still be a relatively small player in the global Green/ Sustainability debt market – with $330 billion raised in 2019 – the rate of growth in ASEAN appears to show the necessary foundations for the development of such a Green/ Sustainability debt market have indeed been laid, including the issuance of a clear set of guidelines for issuers to follow and which investors, both international and domestic, recognize as holistic and reliable,” Amatong said.

For now, Indonesia, Malaysia, the Philippines, Singapore and Thailand dominate the ASEAN Green and Sustainability bond market.

The Philippines has seen 15 issuances worth $3.04 billion by a range of private sector issuers, including renewable energy firms and banks taking advantage of both on- and offshore markets.

Amatong cited the issuance of a clear set of guidelines for issuers among the “necessary foundations” for the development of the ASEAN Green and Sustainability debt market.

“First, we at the ASEAN Capital Markets Forum (ACMF) recognized early on the potential of green and sustainable finance to attract international investors, who, generally speaking, have had more funds to invest than investible options,” Amatong said.