What’s new: China’s first batch of interbank transition bonds was launched earlier this week, aimed at funding green transformation projects as Beijing pushes its sweeping decarbonization drive.
Five state-owned enterprises (SOEs) issued the bonds, according to a Thursday statement released by the National Association of Financial Market Institutional Investors (NAFMII), a self-regulatory body of the interbank bond market, one of the country’s two major bond markets.
The issuers were Huaneng Power International Inc., Datang International Power Generation Co. Ltd., Aluminum Corp. of China Ltd., Wanhua Chemical Group Co. Ltd., and Shandong Iron and Steel Group Co. Ltd.
The proceeds from the bonds will be used for the decarbonization of high-emission projects such as power generation and aluminum production.
The background: Transition bonds, a new kind of debt designed to help decarbonize emission-intensive sectors, are part of China’s efforts to meet its ambitious “dual carbon” goals — reaching a peak in carbon emissions before 2030 and achieving carbon neutrality by 2060.
Last month, several SOEs issued such bonds on the Shanghai Stock Exchange, part of the exchange market, the other major bond market besides the interbank market.
In recent years, regulators in the world’s largest emitter of carbon dioxide have been working on various ways to use finance to support the green transition, including carbon markets and green finance.
Related: In Depth: Everything You Need to Know About China’s Decarbonization Drive
Contact reporter Tang Ziyi (ziyitang@caixin.com) and editor Jonathan Breen (jonathanbreen@caixin.com)
Get our weekly free Must-Read newsletter.
