Governments, supranationals and agencies will be the largest contributors. With an expected total of €160 billion in 2024, sovereigns, supranationals and agencies will account for approximately half of total euro ESG bond issuance in 2024.
The ESG issue denominated in EUR by supranationals and agencies has reached €95 billion so far this year, meaning full-year levels will likely fall below 2022 and our initial target of €131 billion. By 2024, we calculate an aggregate figure of 100 billion euros. A slowing factor behind the relatively low emission is the European Union. The EU has become a dominant player in the green bond segment: €24.4 billion in EU green bonds were issued in 2022. In 2023, this figure will rise to a meager €7.7 billion, with only one more window left for a syndicated deal and two auction slots this year to significantly increase this figure.
The one denominated in EUR sovereign ESG issuance (mainly green bonds) currently stands at around €64 billion, a figure slightly higher than we had anticipated. It appears that volumes in the final months of the year will remain limited, pointing to a final figure of around €65 billion. For next year, we expect emissions growth to stagnate as overall government funding plans could be moderately lower. We forecast €60 billion in gross ESG emissions for the sector in 2024.