Thailand Issues Asia’s First $880M Sovereign Sustainability-Linked Bond Backed by ADB

Thailand has issued Asia’s first sovereign sustainability-linked bond (SLB), raising 30 billion baht ($880 million) in a groundbreaking move to align financial markets with ambitious climate goals. Supported by the Asian Development Bank (ADB), the bond underscores Thailand's commitment to transitioning towards a net-zero economy.

The 15-year SLB, launched on November 25, 2024, includes measurable sustainability targets, such as reducing greenhouse gas emissions by 30% and increasing zero-emission vehicles (ZEVs) to 440,000 passenger cars and pickup trucks by 2030. The issuance attracted robust interest, being oversubscribed by more than 2.7 times, demonstrating strong local and international investor confidence.

ADB Country Director for Thailand, Anouj Mehta, highlighted the significance of this development:

“This bond reflects ADB’s commitment to innovative financial solutions to support Thailand’s climate targets.”

The SLB builds upon Thailand’s first sustainability bond, issued in 2020, and advances the use of financial markets to attract both public and private investments for sustainable development initiatives. Patchara Anuntasilpa, Director General of the Public Debt Management Office (PDMO), stated:

“The SLB structure reflects Thailand’s commitment to addressing climate change and fostering a sustainable economy and society.”

A Model for Climate Financing

ADB provided technical assistance for the issuance through initiatives like the Green, Social, Sustainable, and Other Labeled Bonds (GSS+) Initiative under the ASEAN Catalytic Green Finance Facility (ACGF) and Asian Bond Markets Initiative (ABMI). These programs aim to accelerate green infrastructure investments and develop local currency bond markets across Southeast Asia.

Catalyzing Green Growth

The success of Thailand’s SLB issuance highlights the potential of innovative financial tools to drive meaningful climate action while strengthening capital markets. It sets a precedent for other countries, state enterprises, and private sector participants to align their financing mechanisms with sustainability objectives.

This move is a key milestone in Thailand’s journey toward carbon neutrality by 2050 and net-zero emissions by 2065, solidifying its position as a leader in sustainable economic growth.