Mexico accumulates USD38.3 billion in thematic bonds until 2023
Climate Bonds Initiative, in collaboration with the LAGreen Fund, with the financial assistance of the European Union, announces the “Mexico Sustainable Debt State of the Market 2023” report. The launch of this report was made possible thanks to the collaboration and continued support of BIVA, which hosted the launch event. The study details an impressive USD38.3bn of cumulative issuance of Green, Social, Sustainability, and Sustainability-Linked Bonds (GSS+) aligned with Climate Bonds’ screening methodologies issued in the county by the end of 2023. This represents a 25% year-over-year (YoY) increase, underlining Mexico’s position as the second largest market for labelled bonds within Latin America and the Caribbean (LAC).
Key Findings:
Market Leadership: In 2023, Mexico’s GSS+ bonds issuance reached USD14.7bn in alignment with Climate Bonds’ screening methodologies, which represents 25% increase in aligned volume. This solidifies Mexico’s leading position in the LAC sustainable finance market, representing 21% of the region’s total cumulative volume by the end of 2023
Sovereign and Development Bank Contributions: Significant contributions came from sovereign issuers and development banks, with the public sector accounting for 75% of the total volume. The Mexican government issued 14 sustainability deals worth USD13.3bn, while the local development bank Banobras issued 17 deals totaling USD4.5bn of cumulative issuance.
Sectoral Opportunities: The report highlights substantial investment opportunities in the circular economy, sustainable infrastructure, low-carbon buildings, transportation, and nature-based solutions such as reforestation and sustainable land management which could be aligned with the Mexican Sustainable Taxonomy.
Market Trends:
Enhanced Alignment Rates: In 2023, 83% of Mexico’s GSS+ debt volumes issued adhered to Climate Bonds’ methodologies, reflecting improved disclosure practices and alignment with technical screening criteria. This percentage is higher than the global rate (80%) and the LAC rate (75%).
Dominance of Sustainability Bonds: Sustainability bonds dominated Mexico’s GSS+ market, accounting for 72% of the cumulative aligned volume issued in Mexico and 43% in LAC, where green bonds dominate.
Infrastructure and Manufacturing Focus: Increased demand for sustainable infrastructure projects, driven by nearshoring and federal initiatives, and the manufacturing sector’s role as a significant GDP contributor highlight the market’s diverse investment potential.
Kurt Vogt, Board Member – LAGreen: “At LAGreen, we are thrilled to see the significant strides Mexico has made in sustainable finance, particularly in the thematic bond market. As the report shows, it is not only about the impressive growth of this segment of the fixed income market, but also the impact credentials of the bonds placed, the number of new issuers and the diversity of sectors represented. This outcome results from of the good work conducted over the years by key market players such as local and international development banks, financial institutions, institutional investors, market associations and issuers. We are therefore proud to support initiatives that drive the development of this vibrant and innovative market and to contribute to a sustainable future for all.”
Andrés Felipe Sánchez, Head of Latin America and the Caribbean, Climate Bonds Initiative:
“Mexico’s leadership in the sustainable finance market is a testament to the collaborative efforts between the public and private sectors. The progress we’ve seen is impressive, especially considering that between 2019 and 2023, the GSS+ market in Mexico accounted for around 8% of the overall debt issued in the country, which is double the global figure of 4%. This demonstrates the country’s strong commitment to implementing sustainability strategies that align with international ESG standards.”
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Acerca de LAGreen
LAGreen Fund es el primer fondo de inversión de impacto dedicado a promover la emisión de bonos verdes en América Latina. El fondo tiene como objetivo apoyar los beneficios para el clima, el medio ambiente y la sociedad a través de la promoción del mercado de bonos verdes de América Latina. Con la intención de consolidar los bonos verdes como instrumentos para movilizar recursos hacia modelos económicos más sostenibles y verdes, LAGreen Fund proporciona asistencia técnica e invierte en bonos verdes emitidos en América Latina.
El Banco Alemán de Desarrollo (KFW) creó LAGreen Fund, con capital inicial aportado por la Unión Europea y el Ministerio Federal Alemán de Cooperación Económica y Desarrollo (BMZ) y Finance in Motion como asesor de inversiones. El fondo busca apoyar la emisión de bonos temáticos de alto impacto en la región, atraer un mayor volumen de financiación a largo plazo para proyectos sostenibles, así como apoyar a los emisores mediante asistencia técnica durante las distintas fases de preparación, emisión y post-emisión de los bonos, y mediante compromisos de compra de una parte significativa de la emisión.
Para mayor información, visite https://lagreen.lu y síganos en LinkedIn.
Acerca de Finance in Motion
Finance in Motion es un gestor de activos de impacto global enfocado exclusivamente en el desarrollo sostenible en mercados emergentes y economías en desarrollo. La empresa estructura, gestiona y asesora fondos de inversión de impacto que reúnen a inversores públicos y privados para abordar el cambio climático, fortalecer la conservación de la biodiversidad, fomentar el uso sostenible de los recursos naturales, mejorar los medios de vida y promover oportunidades económicas.
Para más información, visítenos en: www.finance-in-motion.com
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About Climate Bonds Initiative
Climate Bonds Initiative is an international not-for-profit working to mobilise global capital for climate action. Climate Bonds undertakes advocacy and outreach to inform and stimulate the market, provides policy models and government advice, market data and analysis, and administers an international Standard & Certification Scheme for best practice in green bonds issuance. For more information, please visit www.climatebonds.net
