China is experimenting with more green financing as other sources of domestic lending tighten, but its share of green bond issuance globally has slipped.
The diversification of green financing in China has coincided with a rise in international investors’ interest. The Luxembourg Stock Exchange, for instance, offers translated information on a selection of green bonds trading in Shanghai, while Hong Kong is trying to attract mainland issuers to its market.
Despite the international interest, China’s share of the world’s total of green bonds that meet standards set by the Climate Bonds Initiative, an international body, dropped to 12 per cent in the first half of this year, from 15 per cent in 2017 and almost 40 per cent in 2016. The banking sector accounted for just under half.