China issues 4 billion yuan of sovereign green bonds in Canada

China's Ministry of Finance (MOF) said on Wednesday that it has issued 4 billion yuan ($600 million) in sovereign green bonds in Canada, marking Beijing's first issuance of yuan-denominated green debt in the country and underscoring efforts to support green development, broaden offshore funding channels amid improving bilateral relations.

The issuance includes 2 billion yuan of three-year bonds at a yield of 1.4 percent and 2 billion yuan of five-year bonds at 1.5 percent. Demand was strong, with total orders reaching 54.04 billion yuan, or 13.5 times the amount on offer.

The transaction marks the ministry's first offshore yuan-denominated bond issuance in Canada, is an important measure for implementing the second China-Canada Economic and Financial Strategic Dialogue, and is of great significance for deepening China-Canada exchanges and cooperation in the green and economic and financial fields, the MOF said.

China's Vice Minister of Finance Liao Min said at the launching ceremony held in Toronto that the move demonstrates China's firm determination to advance green and low-carbon development and high-level opening-up, and also reflects the practical willingness of both China and Canada to strengthen economic and financial dialogue and deepen pragmatic cooperation. It is of positive significance for moving China-Canada relations onto a track of healthy, stable and sustainable development, Liao said, per the MOF.

The finance ministry said the investor mix was diverse and geographically broad. Investors from Asia-Pacific region accounted for 77 percent of the book, while those from outside this region made up 23 percent, including 15 percent from the Americas and 8 percent from Europe.

Multinational bank Standard Chartered acted as joint lead underwriter on the deal, the bank said in a note sent to the Global Times on Wednesday.

Zhang Xiaolei, head of Standard Chartered China, said that the transaction further expanded the global offshore yuan bond market and strengthened the role of the currency in North American financing and investment, underscoring China's continued financial opening-up and progress in yuan internationalization while broadening the offshore yuan investor base.

The issuance in Canada comes amid China's broader push to expand overseas yuan funding and strengthen the international role of the Chinese currency. It could help broaden the investor base for yuan-denominated assets in North America while offering institutional investors another sovereign-backed investment option, industry observers noted.

"This issuance further improves the yield curve for overseas sovereign debt and provides an important pricing benchmark for Chinese issuers in offshore bond markets," said Wang Hailu, general manager of the financial markets department at Industrial and Commercial Bank of China.

Bank of Communications investment banking general manager Cao Jin said that the issuance drew "active participation" from investors and would help promote the coordinated development of green finance and yuan internationalization.

China has increasingly used sovereign bond sales overseas not only to tap a wider investor base but also to build a benchmark yield curve for yuan-denominated debt issued outside the Chinese mainland. Previously, in April 2025, China issued 6 billion yuan in green sovereign bonds in London.

The second China-Canada Strategic Economic and Financial Dialogue was held on Monday in Vancouver, Canada, where the two sides agreed to enhance financial cooperation, including financial services market access, and exchanges between the capital market and financial regulatory authorities.

Chinese experts said that the mutually beneficial outcomes and consensus reached at the meeting show that the positive momentum in China-Canada economic and trade relations continues to build.

"Against this backdrop, the issuance of sovereign bonds signals warming bilateral relations underpinned by financial co-operation," Li Yong, a senior research fellow at the China Association of International Trade, told the Global Times on Wednesday.