Singapore’s Green Bond Framework: Focus on financing a sustainable future

Shawn Sng  |   06 Jul 2022  |    116 views

Singapore announced in Budget 2022 that the public sector will be issuing up to $35 billion worth of green bonds by 2030 to fund public sector green infrastructure projects, in a bid to support the country’s move towards decarbonization and deepen its green finance market. The bonds will include bonds issued by the Government as well as Statutory Boards.


What is a green bond?

A green bond has the specific purpose of raising money for   climate and environmental projects. These bonds are typically asset-linked and backed by the issuing entity’s balance sheet, and usually carry a credit rating similar to that its issuer’s other debt obligation.

An example would be the bonds issued for the “Tuas Nexus” project which its Phase One is expected to be completed in 2025. Tuas Nexus is an integrated waste treatment facility in Tuas and is financed through green bonds issued by the National Environment Agency (NEA).


Bond framework

On 9th June 2022, the Ministry of Finance released the SG Green bond framework, which sets out the guidelines for sovereign green bond issuance under the Significant Infrastructure Government Loan Act 2021 (SINGA) as announced during the Budget 2022 in February.

This framework ensures that the green bond issuance is in alignment with international guidelines and market best practices. The framework is developed and structured according to the International Capital Market Association (ICMA) Green Bond Principles 2021 and ASEAN Capital Markets Forum ASEAN GREEN Bond Standards 2018.


According to this framework, the proceeds of the green bonds must be used to finance the expenditure in one of 8 green project categories:

  • Renewable Energy
  • Energy Efficiency
  • Green Buildings
  • Clean Transportation
  • Sustainable Water and Waste Management
  • Pollution Prevention, Control and Circular Economy
  • Climate Change Adaptation
  • Biodiversity Conservation and Sustainable Management of Natural Resources and Land Use


Additionally, the issuer has to clearly state the environmental sustainability objectives of the eligible green expenditures. This is the process by which the issuer determines how the expenditure fits within the eligible expenditure categories, and provides complementary information on processes by which it identifies and manages social and environmental risks associated with the relevant expenditure.


The framework also suggests that the issuer should track the net proceeds of the green bond issuance and update its investors annually regarding the use of the proceeds, including allocation and expected impact from the proceeds until the whole issuance is fully allocated, or if there are any material changes.


To provide transparency and accountability for investors and other interested parties, Second Minister of Finance Ms Indranee Rajah will chair the Green Bond Steering Committee, which assumes overall responsibility for proper governance of the Framework.


The eligibility criteria for the Green Categories have also been developed with reference to existing market standards and principles, such as the ICMA Green Bond Principles and the Climate Bond Initiative (CBI) Taxonomy and Sector Criteria.


The Singapore Government will align the framework with regional and global taxonomies as they develop.


In terms of external reviews of the framework, Morningstar Sustainalytics an independent ESG research, ratings and analytics firm, has provided a Second-Party Opinion on the Framework which they have assessed to be aligned with the ICMA Green Bond Principles 2021 and the ASEAN Green Bond Standards 2018.


The Singapore Government has also said that in the coming months they will be issuing sovereign green bonds, also known as Green SGS (infrastructure) bonds under the SINGA, which will be used to finance nationally significant infrastructure while meeting green criteria under the framework. These infrastructure projects are expected to provide long-term environmental benefits.


The Green SGS (infrastructure) bonds are fully backed by the MAS as they will undertake issuance and management of SGS on behalf of the Government. The MAS will provide more details about the upcoming issuance of the Green SGS (Infrastructure) bond closer to its issuance date.


With Environment, Social and Governance (ESG) issues gaining more attention, the upcoming green bonds issuance is expected to appeal to investors who are more environmentally conscious and have a lower risk appetite.

Related Articles

Wing Tai 4.38% 5yr Senior Unsecured SGD

Wing Tai recently announced the issuance of its Senior Unsecured notes at final price guidance of 4.38%.

Shawn Sng  |   26 Mar 2024

Phillip Macro Update – Key Points for March FOMC Meeting

The U.S. Federal Open Market Committee (FOMC) concluded its two-day meeting on the 20th of March 2024. The meeting discussed the Fed’s monetary policy stance and economic projection.

Shawn Sng  |   21 Mar 2024

Oxley’s 6.9% Exchange Offer to the New 7.25% Notes

On 11th March 2024, Oxley announced the exchange offer for their bondholders to exchange their existing Oxley 6.9% 8July2024 notes for the new 7.25% notes.

Shawn Sng  |   12 Mar 2024


These commentaries are intended for general circulation. It does not have regard to the specific investment objectives, financial situation and particular needs of any person who may receive this document. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of any person acting based on this information. Opinions expressed in these commentaries are subject to change without notice. Investments are subject to investment risks including the possible loss of the principal amount invested. The value of the units and the income from them may fall as well as rise. Past performance figures as well as any projection or forecast used in these commentaries are not necessarily indicative of future or likely performance. Phillip Securities Pte Ltd (PSPL), its directors, connected persons or employees may from time to time have an interest in the financial instruments mentioned in these commentaries. Investors may wish to seek advice from a financial adviser before investing. In the event that investors choose not to seek advice from a financial adviser, they should consider whether the investment is suitable for them.

The information contained in these commentaries has been obtained from public sources which PSPL has no reason to believe are unreliable and any analysis, forecasts, projections, expectations and opinions (collectively the "Research") contained in these commentaries are based on such information and are expressions of belief only. PSPL has not verified this information and no representation or warranty, express or implied, is made that such information or Research is accurate, complete or verified or should be relied upon as such. Any such information or Research contained in these commentaries are subject to change, and PSPL shall not have any responsibility to maintain the information or Research made available or to supply any corrections, updates or releases in connection therewith. In no event will PSPL be liable for any special, indirect, incidental or consequential damages which may be incurred from the use of the information or Research made available, even if it has been advised of the possibility of such damages. The companies and their employees mentioned in these commentaries cannot be held liable for any errors, inaccuracies and/or omissions howsoever caused. Any opinion or advice herein is made on a general basis and is subject to change without notice. The information provided in these commentaries may contain optimistic statements regarding future events or future financial performance of countries, markets or companies. You must make your own financial assessment of the relevance, accuracy and adequacy of the information provided in these commentaries.

Views and any strategies described in these commentaries may not be suitable for all investors. Opinions expressed herein may differ from the opinions expressed by other units of PSPL or its connected persons and associates. Any reference to or discussion of investment products or commodities in these commentaries is purely for illustrative purposes only and must not be construed as a recommendation, an offer or solicitation for the subscription, purchase or sale of the investment products or commodities mentioned.

Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you


This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  


Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066