CHINA overtook the United States to lead a boom in global green bond issuance in the first quarter, but analysts said it needs to do more to draw investors to help fund the country’s estimated US$21 trillion carbon neutrality pledge.

Pending tasks include raising investor awareness of the environment, harmonizing fragmented rules and tackling issuers’ efforts to inflate their green credentials, they said.

Chinese issuers including banks, property developers, power generators and railway operators sold US$15.7 billion in bonds during the January-March period to fund “green” projects such as clean and renewable energy, according to Refinitiv data.

The volume of such bonds, mostly yuan-denominated, almost quadrupled from a year earlier, the data showed.

That exceeds the roughly US$15 billion in such bonds sold by U.S. issuers in the first quarter, and helped drive a tripling of green bond issuance globally.

Green bonds blossomed “largely thanks to China’s recovery from the coronavirus,” said Nathan Chow, strategist at DBS. “In addition, the Chinese government is going all out to develop this market this year.”

China needs 140 trillion yuan (US$21.33 trillion) in debt financing over the next 40 years to meet its net-zero emissions target, investment bank China International Capital Corp. (CICC) estimates.

(SD-Agencies)