Green and sustainability-related debt issuance in the Middle East and North Africa region reached $6.4 billion in the first half of 2021, exceeding the total amount for the whole of last year, according to Bloomberg Capital Periodic Tables for the first half of 2021.
Green and sustainability-related debt issuances in the first half of 2021 in the Middle East and North Africa increased by nearly 38% to reach approximately $6.4 billion compared to the total amount for 2020 in the same category of $4.7 billion. Thanks to the green bond issuances from First Abu Dhabi Bank, finance is at the forefront of the sector. The proceeds from these debts were used for real estate projects, project financing and refinancing as well as general corporate purposes.
The Middle East and North Africa witnessed the issuance of the first sustainability-related loan to refinance existing debt from Emirates NBD for $1.75 billion in March 2021, and the first issuance of green bonds denominated in Swiss francs issued by First Abu Dhabi Bank worth 260 million Swiss francs in January 2021, in addition to the first An issuance of green bonds denominated in Chinese yuan issued by First Abu Dhabi Bank worth 150 million yuan in June 2021. Regarding local currency issues, the Red Sea Development Company obtained a green loan of 14.1 billion Saudi riyals in March 2021.
A wide range of international banks participated in green and sustainability-related financing issues in the first half of 2021, with Credit Suisse taking the first place thanks to its role in managing the green bonds of First Abu Dhabi Bank denominated in Swiss francs, followed by HSBC, which participated in the bond issuance. Green card in Chinese yuan with First Abu Dhabi Bank.
“The value of the global ESG market could represent a third of the assets under global management by 2025, and the issuance could exceed one third of the assets under global management by 2025,” said Adeline Diab, Head of ESG Business and Future Investments for Bloomberg Intelligence EMEA and Asia Pacific. Environmental, social and corporate governance debt reached the $3 trillion mark at a record speed during May 2021, as a result of a number of fundamental factors, most notably the outbreak of the Covid-19 pandemic, the race to achieve net zero emissions, in addition to green global financial stimulus plans, and the record low interest rates.
The volume of global green and sustainable debt issuance amounted to about $541 billion in the first six months of 2021. The global market witnessed strong growth in the first half of 2020, but issuances witnessed slow growth, with a value that increased by 12% of the total for the whole of 2020, reaching what Approximately 482 billion dollars. Globally, the financial and government sectors accounted for about 50% of the market share.
A group of banks in the Middle East and North Africa region, such as Abu Dhabi Commercial Bank, Emirates NBD, and Mashreq Bank, participated in the issuance of loans in US dollars / Euros for a number of Turkish banks such as ING Bank IS and Bank Yapi V. Credit Bankassi, and Akbank Tass, over the past two months, with values of between $300-900 million.
2021 is expected to be a pivotal year for environmental and social governance in reshaping markets globally. According to Bloomberg Intelligence’s Global Environmental and Social Governance Report for 2021, more than $3 trillion in fiscal stimulus globally will be dedicated to financing green recovery, while ESG assets could exceed $53 trillion by 2025, representing more than a third of total assets. managed, thanks to the expansion of the ETFs and debt segment.
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