Hong Kong’s Government Successfully Prices Diverse Green and Infrastructure Bonds
The Hong Kong Special Administrative Region Government has made a significant move in sustainable financing by issuing approximately HK$27 billion in green and infrastructure bonds on June 3, 2025. This strategic financial offering demonstrates the city’s commitment to sustainable development and infrastructure advancement.
The bond issuance spans multiple currencies, including Hong Kong dollars, renminbi, US dollars, and euro, showcasing the government’s sophisticated approach to international financial markets. Each tranche of the bonds serves a specific purpose: green bonds aim to channel market capital towards environmentally sustainable projects, while infrastructure bonds are designed to accelerate critical development initiatives like the Northern Metropolis.
The detailed breakdown of the bond issuance reveals a carefully structured offering:
– A 30-year Hong Kong dollar infrastructure tranche of HK$5 billion at 3.85%
– A 20-year renminbi green tranche of RMB 4 billion at 2.6%
– A 30-year renminbi infrastructure tranche of RMB 4 billion at 2.7%
– A five-year US dollar green tranche of USD 1 billion at 4.151%
– An eight-year euro green tranche of EUR 1 billion at 3.155%
The bond offering attracted remarkable global interest, with participation from over 30 markets across Asia, Europe, the Middle East, and the Americas. The total order volume reached an impressive HK$237 billion equivalent, resulting in a subscription ratio ranging from 3.3 to 12.5 times the initial offering. This overwhelming response reflects strong international confidence in Hong Kong’s financial markets and economic potential.
A notable highlight of this issuance is the 30-year Hong Kong dollar bond, which represents the longest-tenor HKD bond ever issued by the Hong Kong SAR Government. The renminbi-denominated bonds also saw significant success, with their issuance size doubling compared to the previous year.
Financial Secretary Paul Chan emphasized the enthusiastic response from global institutional investors, interpreting it as a clear signal of confidence in Hong Kong’s public finance and long-term development trajectory. The introduction of the 30-year HKD government bonds is particularly significant as it helps extend the HKD benchmark yield curve and contributes to the development of the local bond market.
Investors and market watchers will be interested to know that these bonds have received strong credit ratings, with S&P Global Ratings assigning an AA+ rating and Fitch providing an AA- rating. The bonds are set to be settled on June 10 and will be listed on both the Hong Kong Stock Exchange and the London Stock Exchange.
This innovative bond issuance not only demonstrates Hong Kong’s financial sophistication but also underscores its commitment to sustainable development and infrastructure investment. By offering bonds across multiple currencies and tenors, the government provides diverse investment opportunities while simultaneously supporting critical economic and environmental initiatives.
The successful pricing of these green and infrastructure bonds represents a strategic approach to financing future development, attracting international capital, and maintaining Hong Kong’s position as a global financial hub. It reflects a forward-thinking strategy that balances economic growth with sustainable development goals.
