Green bonds financing the future

The ESG bond market is fast becoming an essential pillar of the country's sustainable development strategy, writes Nuntawun Polkuamdee

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As the world navigates the transition towards sustainability, Thailand's environmental, social and governance (ESG) bond market has steadily gained ground, though it does not make loud headlines.

In the first five months of 2025, ESG bonds worth nearly 77 billion baht were issued, underscoring investor interest even as overall corporate issuance of all types of bonds slowed amidst a subdued economy.

THE LONG GAME

ESG bonds are no longer a niche segment, say analysts. Since the first issuance in 2019, with a total value of 23 billion baht by private companies, the market expanded to include sovereign issuers and now boasts cumulative issuance of 888 billion baht.

According to the Thai Bond Market Association (ThaiBMA), the ESG bond sector has grown rapidly from its inception in 2019.

In 2020, ESG bond issuance rose to 86.4 billion baht, marking the first time the government participated in the market, attributed to the Covid-19 crisis.

In 2021, total ESG bond issuance tallied 168 billion baht, consisting of 112 billion from the government and 56 billion from corporate issuers.

In 2022, the figure rose to 214 billion baht, with 143 billion from the government and 70 billion from the private sector.

The following year, ESG bond issuance totalled 180 billion baht, comprising 143 billion baht from the government and 37 billion from corporates.

Last year ESG bond issuance tallied 176 billion baht, comprising 114 billion from the government and 62 billion from the private sector, according to ThaiBMA.

In the first five months of this year, ESG bond issuance totalled 77 billion baht, of which 69 billion was issued by the government, while private issuance slowed to only 7.8 billion.

"The annual data reveals a strong upward trend, particularly from the government," noted the association.