In the 2022-23 Budget Speech by Paul Chan Mo-Po, Financial Secretary, Hong Kong S.A.R Government, suggests that green and sustainable finance development in Hong Kong continues to be a key initiative to support Hong Kong’s net zero agenda as well as the country’s “3060” target in relation to carbon emission peak and carbon neutrality.
Dr. MA Jun, Chairman & President Hong Kong Green Finance Association, says that “The successful issuance of over US$7bn equivalent of green bonds under the Government Green Bond Programme demonstrates global investor confidence in Hong Kong’s economy and its green initiative. The government’s commitment to issue green bonds totalling USD4.5bn this year, the planned issuance of retail green bonds and the expansion of the green and sustainable finance grant scheme, as announced in the Financial Secretary’s Budget Speech today, will further enhance the role of Hong Kong as an international green finance hub. In particular, the government subsidy through the grant scheme for green loan verification has been an innovation in Hong Kong, and will form part of international best practices. ”
“We are particularly excited about the launch of the pilot Green and Sustainable Capacity Building Support Scheme, which is a key to address the talent gap and help keep and attract green finance professionals in Hong Kong. The Hong Kong Green Finance Association (HKGFA) is pleased to support the Government’s efforts in this regard. HKGFA has already developed plans to work with the government and educational institutions to launch training programs on green finance and ESG investing. We will also work through the Greater Bay Area Green Finance Alliance to facilitate international investor access to quality green projects in Mainland China and explore options for mutual recognition of green finance products in the GBA area.”
Read the Full Budget Speech
Excerpt of the Budget Speech on Green and Sustainable Finance
77. We have been committed to promoting the development of retail bonds so as to benefit the public. I plan to issue no less than $15 billion of inflation linked retail bonds (i.e. iBond) and no less than $35 billion of Silver Bond in the next financial year, with a view to offering members of the public, particularly the elderly, investment options with steady returns. Details of the first batch of retail green bonds for public subscription were announced last week. Members of the public can directly invest in green projects that provide environmental benefits so as to jointly create a green environment for green living in Hong Kong while gaining steady inflation linked returns. I plan to continue to issue no less than $10 billion of retail green bonds in the next financial year.
83. The development of green and sustainable finance in Hong Kong offers promising prospects. By leveraging our advantages as an international financial centre, we can facilitate matching between international capital and quality green projects, contribute proactively to helping our country achieve its “3060 Target” in relation to carbon emission peak and carbon neutrality, as well as propelling Hong Kong towards our carbon neutrality target by 2050 and promoting green transformation of our economy.
84. Since the launch of the Government Green Bond Programme in 2018, a total of more than US$7 billion equivalent of green bonds targeting global institutional investors has been successfully issued. Several important milestones have been achieved, including the issuance of a 30-year US dollar-denominated green bond and a 20-year euro-denominated green bond and, both of which are the first issuance among Asian governments, and have established an important reference benchmark for the thriving development of the bond market in Hong Kong. The successful issuance of RMB green bonds by the Shenzhen Municipal Government in Hong Kong has set a leading example for GBA cities to make good use of the Hong Kong market for green financing. It has also further strengthened Hong Kong’s functions as an offshore RMB hub and a green financial centre. This year, we will continue to issue green bonds totalling about US$4.5 billion or equivalent.
85. The Green and Sustainable Finance Grant Scheme launched last year has been well received by the industry. Over 50 applications have been approved so far, covering various kinds of green and sustainable debt instruments. Among the applications approved, many of them involved subsidies for covering the external review costs relating to green and sustainable loans. To support enterprises in obtaining green financing, we will lower the minimum loan size from $200 million to $100 million in respect of applications for subsidies for covering external review costs under the scheme.
128. Having regard to the new trend of developing low carbon and sustainable economy, we plan to launch a three year Pilot Green and Sustainable Finance Capacity Building Support Scheme. Under the scheme, subsidies will be provided for the training and acquisition of relevant professional qualifications, so as to encourage practitioners in the financial and other relevant sectors to participate in the training.
Source on Budget Speech: https://www.budget.gov.hk/2022/eng/pdf/e_budget_speech_2022-23.pdf