China
• China’s outstanding ESG bond value stands at USD 302 billion, while new issuance in May 2025 slowed to USD 5.9 billion (down 12% YoY), marking the first contraction in 2025.
• KResearch expects this contraction to be only temporary, as China’s ESG bond market remains on a continued growth trajectory.
United States
• The US ESG bond market has begun to recover, following a sharp contraction in the previous month. Outstanding ESG bonds rose to USD 279.2 billion, up from USD 278.7 billion in the prior month, supported by stronger new issuance activity.
• In May 2025, new issuance reached its highest level since the beginning of the year, accelerating to USD 3.5 billion from USD 1.6 billion in the previous month. Most issuers were financial institutions, indicating that issuance was driven more by investment purposes than by fundraising for ESG-specific projects.
Thailand
• Thailand’s outstanding ESG bond value has resumed its growth, supported primarily by USD 0.4 billion in new issuance from the Government Housing Bank (GHB), WHA, and MINOR, mainly for roll-over purposes (debt refinancing). As a result, outstanding ESG bonds increased to USD 25.9 billion.
• On 27 May 2025, the Bank of Thailand (BOT) announced Thailand Taxonomy Phase 2, expanding its coverage to include the agriculture, real estate, manufacturing, and waste management sectors. This development helps classify ESG-related activities more clearly, reduces greenwashing risks, and supports the growth of Thailand’s sustainable finance market.
Outlook
• KResearch expects that China’s and Thailand’s ESG bond markets will continue expanding, while the U.S. market will see a partial recovery.
• China: Strong growth is expected to continue, with China likely to keep outpacing the U.S., driven by its commitment to reducing carbon emissions per unit of GDP by around 18% by 2025 and achieving peak greenhouse gas emissions by 2030.
• United States: The market is expected to show some recovery as the contraction in new ESG bond issuance has begun to ease.
• Thailand: Growth is expected to continue as both the public and private sectors remain committed to transitioning toward ESG practices, despite uncertainties stemming from the U.S. trade war.
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