Bankers remain bullish on ESG bond issuance in China, Asia

The sustainability deal outlook has remained blushing in China and in the Asian region. Bankers are optimistic about the issuance of green and sustainable financing in the region despite offshore bond transactions falling this year due to rising interest rates and currency depreciation against the US dollar. Puja Shah, head of ESG debt capital markets for Asia excluding Japan at JPMorgan, said that bond deals in China will be driven by ongoing funding needs from low-carbon industries such as renewable energy, electric vehicles, hydrogen, and energy-efficient buildings, in addition to growth in managed funds focusing on environment, social and governance (ESG) themes. She said that ESG continues to remain a focus in China, but given the volatility in the offshore bond market and elevated cost of borrowing, some issuers chose to access the domestic market instead.