China to Launch First Sovereign Green Yuan Bonds in the UK, Raising $829 Million
China is set to issue its first-ever overseas sovereign green bonds in yuan, selecting London as the listing venue in a move that both underscores its climate ambitions and strengthens financial ties with the United Kingdom.
The Chinese Ministry of Finance confirmed on Wednesday that up to 6 billion yuan (approximately $829 million or £660 million) in green bonds will be issued in 2025. This marks the first phase of a wider programme of sovereign green debt issuance abroad and represents a significant step in China’s efforts to attract global capital to fund its domestic green and low-carbon initiatives.
The decision follows the January China-UK Economic and Financial Dialogue, co-chaired by Chinese Vice Premier He Lifeng and UK Chancellor Rachel Reeves. During the talks, both sides agreed on the importance of deepening sustainable finance cooperation and accelerating climate action through joint initiatives.
In a statement, the Ministry of Finance said the two countries agreed that “China would issue an inaugural yuan-denominated sovereign green bond in 2025 and that this would be listed in London, the first in a programme of Chinese green sovereign issuances in the UK.”
This announcement builds on China’s earlier release of its sovereign green bond framework in February, which laid out criteria for green projects eligible for funding. The framework is designed to channel international investment into Chinese initiatives focused on renewable energy, sustainable transport, and pollution control. The country aims to peak carbon emissions before 2030 and achieve carbon neutrality by 2060, as outlined in its climate commitments under the Paris Agreement.
The issuance in London is also a notable nod to the UK’s ambitions to become a global hub for green finance. The City of London has seen increasing interest in sustainable investments, and this move from China is expected to bolster the capital’s position in the global green bond market. According to the Climate Bonds Initiative, global green bond issuance surpassed $1 trillion in 2023, with the UK among the leading markets for green finance.
The collaboration also reflects strengthening diplomatic and economic ties between China and the UK in the area of environmental sustainability. During a meeting earlier this week with British Energy Security and Net Zero Secretary Ed Miliband, Chinese Vice Premier Ding Xuexiang reaffirmed this commitment, stating that “China is willing to work with the UK to deepen cooperation in green and low-carbon development.”
For further context on China’s evolving green finance strategy, see the Securities Times article on the country’s plan to issue guiding principles for green bonds.
This landmark issuance could serve as a model for other emerging markets looking to tap international capital markets in support of climate goals, while also reinforcing London’s role in the global transition to a low-carbon economy.
