Climate change: Hong Kong has unique role to play as China’s offshore capital hub for green finance, says UN envoy
- ‘China must build on the progress it has made in green finance by … accelerating projects with environmental benefits,’ says Siddharth Chatterjee
- ‘Green finance has emerged as a vital tool in the transition to a more sustainable economy,’ Chatterjee tells the Hong Kong Financial Forum 2023 on Monday
The city accounted for a third of sustainable debt – including both bonds and loans – issued across Asia last year, according to Joseph Chan, undersecretary for financial services and the treasury. The value of such debt increased by more than 40 per cent year on year in 2022 to US$80.5 billion, Chan said in June at the Redefining Hong Kong conference organised by the Post.
To tackle climate change and shift to a sustainable economic model will require a huge amount of investment, Financial Secretary Paul Chan Mo-po said at Monday’s forum.
“Asia’s green transformation will require around US$66 trillion in investment over the next 30 years, highlighting the huge demand for green financing in the region,” said Chan.
“With such large demand for [green] financing, we cannot only rely on the government but must utilise market resources to achieve this.
Sustainable finance benefits not only the environment but also has the potential to open up new economic opportunities, create jobs in the renewable energy sector, and improve energy security, said Chatterjee.
He said China should focus on extending green financing beyond just bonds, and actively incorporate these concepts into the Belt and Road Initiative – China’s plan to grow global trade.
Chatterjee highlighted the Industrial and Commercial Bank of China’s issuance of the world’s first green interbank regular cooperation bond to fund green belt and road projects in 2019. The bond was denominated in yuan, US dollars and euros totalling US$2.2 billion.
“The example of China embracing green financing can serve as an example of how other countries and the private sector can embrace financial sustainability while protecting the environment,” said Chatterjee.