This week, as we gathered for the final and sixth edition of our flagship Unlocking capital for sustainability forum in Singapore, the Financial Times ran a sobering story on the costs of Trump’s campaign to censor climate science.
Key federal datasets are being removed, websites erased, and scientists fired. Experts are sounding alarms about the long-term consequences, particularly on weather forecasting, disaster management, and our broader understanding of a rapidly changing planet.
For those of us working in sustainable development, 2025 has felt like a “winter year” with progress fragile amid intensifying geopolitical tensions and the multilateral order under stress.
But even as political denial and regulatory paralysis grip parts of the West, a different message has been resounding across Asia – it is not retreating, but rising to the occasion.
Despite global headwinds, the region’s momentum in sustainable finance remains one of the few bright economic stories of the year.
At the forum, hosted by Eco-Business in partnership with the United Nations Environment Programme Finance Initiative (UNEP FI) and multiple partners, business and policy leaders affirmed Asia’s determination to act.
The numbers tell the story
Global sustainable finance issuance reached nearly US$975 billion in the first seven months of 2025, a figure that, despite slower early quarters, has already outpaced 2023’s total.
While green finance momentum stagnates in Europe and falls victim to polarisation in the US, Asia Pacific is surging ahead – driven by clearer policies.
Across six markets – Hong Kong, Jakarta, Kuala Lumpur, Manila, Bangkok and Singapore – Unlocking capital for sustainability has traced this transformation of green finance maturity.
In Hong Kong, sustainable bond issuance surged 43 percent to US$43 billion in 2024, which accounted for nearly half of Asia’s market share for international sustainable debt, according to the Climate Bonds Initiative.
Powered by the city’s 2024 Sustainable Finance Taxonomy, which aligns with international frameworks and underpins government green bond issuances worth nearly US$16 billion, this progress underscores how regulatory clarity fuels investor confidence.
The same report also revealed China’s total cumulative issuance reached US$ 555.5 billion, ranking top four globally and becoming one of four markets to surpass the half-trillion mark.
Indonesia tells a more complex story. Confronted with a US$285 billion climate investment gap, the Financial Services Authority has begun embedding climate risk guidance into mainstream lending. The country also recently launched 10-year power procurement plan that aims to expand renewable energy capacity, although there needs to be further policy reforms to ensure that funding flows to clean energy projects. Entrenched fossil fuel subsidies and social and political unrest also highlight how policy inconsistency continues to impede its energy transition.
In Malaysia, climate ambition has been a hallmark of the country’s leadership in the region as Asean chair and the theme of “Inclusivity and Sustainability” this year.
It has doubled ESG bond issuance in the first half of 2025, with total issuance soaring to RM7.93 billion from a year earlier, and has championed collaborative regional efforts such as the Asean Common Carbon Framework and Infrastructure Fund Action Plan, advancing sustainable finance as an Asean-wide policy priority. The newly launched Asean Power Grid Financing Facility, backed by the ADB and World Bank, promises to mobilise over US$12 billion for the three-decades old dream of cross-border energy interconnections.
The Philippines, set to chair Asean next year, is positioning climate adaptation finance at the centre of its agenda. At our Manila forum in August, the Philippines central bank BSP said it will as Asean chair lead on a regional framework to scale blended finance and boost investments in climate adaptation projects through de-risking mechanisms. The government’s “Green Force” initiative is updating the national Sustainable Finance Framework and developing new guidelines under the Public-Private Partnership (PPP) Code.
Thailand’s market has surged as well. ESG bond issuance there has multiplied nearly fortyfold since 2019 to over THB 900 billion, driven by proactive taxonomy work by the Bank of Thailand and the SEC. In the first five months of 2025 alone, THB 77 billion in ESG bonds were issued – evidence of investor confidence returning alongside political stability and pending reforms, including the highly-anticipated Power Development Plan and climate change act.
And in Singapore – the financial nerve centre of the region – the Monetary Authority’s Finance for Net Zero (FiNZ) Action Plan and FAST-P platform aims to mobilise US$5 billion for sustainable infrastructure.
Already Asean’s largest green bond issuer – accounting for more than half of the region’s total – Singapore has pledged up to S$35 billion (US$27 billion) in public sector green bonds by 2030 to deepen market liquidity and attract issuers and investors.
While its decision to delay some disclosure timelines for smaller to mid-cap companies raised eyebrows earlier this year, regulators have stressed Singapore remains firmly committed to sustainability reporting and climate ambitions – and wanted to give companies more time to build capacity.
From narrative to necessity
The rise of sustainable finance in Asia is no longer just an aspirational story – it is an economic imperative. The region’s progress demonstrates that credible taxonomies, transparent data, and pragmatic policymaking can ground sustainable development outcomes in commercial logic rather than moral appeal.
Still, systemic challenges linger: fragmented regulations, high issuance costs, and uneven data quality continue to limit market depth. This is why regional collaboration among regulators, financiers, and civil society remains critical.
Innovative financing models such as “debt-for-nature” swaps illustrate what is possible when fiscal restructuring, done right, can deliver both environmental and development gains.
For example, Ecuador’s $1.5 billion debt-for-nature swap – a deal to refinance a portion of its debt in exchange for conservation commitments – unlocked $460 million for protecting the Amazon’s terrestrial and freshwater ecosystems over 17 years.
Asia – home to biodiversity-rich yet debt-vulnerable economies – can adapt these mechanisms at scale.
In an era when climate science is under siege and multilateralism is fraying, Asia’s steady advance in sustainable finance is more than a policy achievement. It is an act of resilience – and, in its quiet way, defiance – underscoring once again the shift of the world’s economic centre of gravity towards the region.
