China’s HNCA Launches First International Green Bond

HNCA Ring Bell Ceremony. (© LuxSe)

The governor of the Henan province (China), members of the Henan Civil Aviation Development & Investment Co. Ltd (HNCA), joined the Luxembourg Stock Exchange (LuxSE), listing the Chinese aviation group’s first international green bond, with a focus on “sustainable aviation fuel.”

The ring ceremony coincided with the official visit of a high-level delegation from Henan province to Luxembourg. This visit included the second Zhengzhou and Luxembourg Air Silk Road International Cooperation Forum held on June 20, at LuxExpo, attended by figures such as the vice premier of the People’s Republic of China, Ding Xuexiang, Luxembourg’s deputy prime minister Xavier Bettel, and LuxSE’s CEO Julie Becker.

HNCA’s inaugural green bond marks its entry into international capital markets, making it the first Chinese entity to issue a green bond with a focus on sustainable aviation fuel and other key sustainability projects.

“The aviation industry can and must play an important role in creating a more low-carbon future. As a leader in the field of sustainable finance, we are delighted to welcome HNCA to the Luxembourg Stock Exchange and Luxembourg Green Exchange with this important green bond.”

Julie Becker, CEO of LuxSE.

Interplay of sustainability and aviation

HNCA’s green bond, valued at “RMB 200m,” signifies the company’s commitment to sustainable aviation. The funds raised through this green bond will finance several pivotal projects aimed at enhancing sustainability within the aviation sector, including research, production, and manufacturing of sustainable aviation fuel, Cargolux’s sustainable aviation fuel program, and the construction of a green building project that will serve as HNCA’s aviation training centre. “This issuance underpins HNCA’s commitment to creating a more sustainable aviation industry, and we look forward to supporting its efforts in the future as we continue to help finance the decarbonization of the transportation industry,” said Becker.

HNCA’s engagement with Luxembourg began in 2014 with the acquisition of a 35% stake in Cargolux, Luxembourg’s flag carrier cargo airline. This partnership has deepened over the years, enhancing connectivity between Luxembourg and mainland China. The issuance of HNCA’s green bond at LuxSE further cements this relationship, expanding their collaboration into sustainable finance.

Strengthening bi-lateral ties

 “This bond issuance marks an important moment in HNCA’s continuous efforts to strengthen its cooperation with the Luxembourg Stock Exchange and the grand duchy as a whole. We look forward to further collaborating to mobilize international capital to support the development of a more sustainable aviation industry and the development of the Henan Province,” said Zhang Mingchao, party secretary and chairman of HNCA.

The listing of HNCA’s green bond at LuxSE displays the role of international financial markets in supporting sustainable development initiatives. It also exemplifies the growing trend of integrating sustainability into the core strategies of major industries, including aviation.

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