The Role of Green Bonds in Financing a More Sustainable Economy
By Sofía Aksenova
In the first months of 2025, the sustainable debt market has shown signs of a slowdown, driven by economic uncertainty and geopolitical risks. However, it would be a mistake to think that green bonds are losing relevance. In fact, green bonds have established themselves as a key tool for financing initiatives that generate a positive environmental impact, with a global market that already exceeds $3 trillion in volume.
After the first three quarters of 2025, green bond issuance reached $467 billion, representing a 1% increase compared to the same period in 2024, a year that recorded the highest issuance volume to date, reaching $572 billion. Europe remains the leading issuer in 2025, accounting for approximately 55% of the total, followed by Asia and the Americas.
Why are green bonds relevant?
First, green bonds have demonstrated a real ability to channel capital toward environmentally sustainable projects with tangible impact, such as renewable energy, energy efficiency, and sustainable infrastructure, directly contributing to emissions reduction and the transformation of the energy model.
Second, the current context reinforces the need to expand the scope of sustainable finance toward areas such as climate adaptation and resilience. Economic losses resulting from natural disasters remain high: in the first half of 2025 alone, they reached approximately $162 billion, underscoring the urgency of mobilizing capital toward these types of investments.
Finally, green bonds play an important role in financing the energy transition and sustainable infrastructure projects, especially in an environment marked by rising electricity demand and, above all, current tensions in energy markets. A clear example of the growing need for energy can be seen in the development of artificial intelligence, which is driving energy demand to levels that fossil fuels alone will not be able to meet.
Global Green Bond Initiative (GGBI)
Within this context, the European Union, together with the European Investment Bank (EIB) and other development finance institutions, has launched the Global Green Bond Initiative (GGBI), an ambitious initiative that reflects the global commitment to a transition toward more sustainable and inclusive economies.
As part of this project, a green bond fund of approximately €2 billion is expected to be created, with a special focus on emerging economies in regions such as Latin America, Africa, Asia, and Central Asia. Through investments in green bonds, the fund will not only help finance climate- and environment-related initiatives, but will also strengthen local capital markets and encourage the participation of new issuers, particularly those accessing this type of financing for the first time, such as governments, local authorities, and companies.
The fund will focus on six strategic sectors: agriculture, energy, water, recycling, urban development, and transport. In doing so, it will contribute to achieving several Sustainable Development Goals (SDGs), including SDG 9 (Industry, Innovation and Infrastructure), SDG 12 (Responsible Consumption and Production), SDG 13 (Climate Action), and SDG 17 (Partnerships for the Goals).
This initiative forms part of the European Union’s Global Gateway strategy, which aims to mobilize around €20 billion in private capital to finance major infrastructure projects. It also supports the transition toward resilient, low-carbon economies, helping to reduce the climate finance gap and strengthen international cooperation.