A purple patch for China's green bond market

With green bonds issued in the first half of the year reaching 75 billion yuan (11 billion U.S. dollars), 33 percent of the world total, China has become the world's largest green bond market, a central bank economist said here Friday.

This figure is around two percent of the total assets of China's commercial banks, and demand for green bonds is expected to rise to 20 times that much, said Ma Jun, chief research economist at China's central bank, told a green finance forum.

In July, Shanghai Pudong Development Bank (SPDB), the first bank to issue green bonds on China's inter-bank market, will issue 15 billion yuan of bonds to replenish projects in clean transportation and pollution control, according to SPDB Vice Governor Xie Wei.

Green finance is having its best time in China as the country repositions its economy for sustainable development, said Xie.

The potential of green finance will be particularly felt in the spheres of urbanization, the Belt and Road Initiative and infrastructure construction, he added.

Two years ago at the first green finance forum, also in Guiyang, the concept was unfamiliar to most participants, Ma Jun recalled on the sidelines of the current forum. Those participants became the primary enablers within the People's Bank of China (PBoC) in green finance, said Ma. "Guiyang is an incubator to some extent," he added.

Last December, the PBoC allowed green bonds on to the inter-bank market. Then the Green Finance Committee of China Society of Finance and Banking released the Green Project Catalog, while the National Development and Reform Commission issued guidelines on green bond issuance.

These milestone documents have given the green bond market its solid foundation, empowering the domestic banking industry use its financing muscle to implement the national strategy, said Ma.
Source:XINHUA