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In order to raise 30 billion baht (USD $865 million), the Thai government announced the completion of its first Sustainability-Linked Bond (SLB). Interest rates on the new 15-year notes are linked to the nation’s energy transition and climate goals.
The PMDO increased the offering from 20 billion baht to 30 billion baht due to the high demand for the bonds, which was oversubscribed by 2.8 times.
The Public Debt Management Office (PMDO) of Thailand claims that the issue is the third government sustainability-linked bond in the world and the first in Asia. The offering represents an important turning point for SLBs, which have struggled in recent quarters due to scrutiny of issuers about things like the reliability and validity of the bonds’ associated sustainability targets, following the market’s explosive rise earlier in the decade.
Thailand’s new SLB is tied to two sustainability performance targets. These include lowering overall greenhouse gas emissions from “business-as-usual” levels by 30% by 2030 and increasing the number of new registrations of zero-emission passenger vehicles, such as cars and pickup trucks, to 440,000 annually by that same year.
The PMDO has previously stated that it would issue a 130 billion baht (USD$3.9 billion) SLB in 2025 prior to its debut selling.
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