The Ministry of Climate, Energy and Environment and the Korea Environmental Industry & Technology Institute (KEITI) announced a significant expansion of the Korean Green Bonds and Green Asset-Backed Securities Support Program for 2024. This initiative incorporates the revised Korean Green Taxonomy, updated in December 2023, to broaden support for next-generation low-carbon technologies and meet corporate funding needs. Green asset-backed securities are issued by applying the Korean Green Taxonomy to asset securitization based on SME and mid-sized company bonds, enhancing creditworthiness. The program aims to foster private-led green investment and support Korea’s carbon neutrality goals.
With the revised taxonomy, new green economic activities such as heat pumps, clean methanol, and carbon-neutral ICT have been added to the eligible list for green bond issuance support. From this year, SMEs and mid-sized companies can receive interest subsidies not only for facility funds but also for working capital related to green economic activities. Criteria for facility fund recognition have been tailored to industry characteristics, such as construction and shipbuilding, improving accessibility to green bond issuance. Support for green asset-backed securities issuance, especially for SMEs facing market entry barriers, has also been strengthened.
Issuers of green asset-backed securities will now receive interest cost support for up to three years, compared to the previous one-year limit, reducing financial burdens. For 2024, interest costs incurred when issuing green bonds or asset-backed securities under the Korean Green Taxonomy will be subsidized up to KRW 300 million per company. Listing fees and annual charges for green bond issuers will be waived for one additional year, until December 31, with cooperation from the Korea Exchange. Seo Young-tae, Director of Green Transition Policy at the Ministry, emphasized the importance of improving access to green finance and expanding private-led green investment.
Applications for the green bond interest subsidy program open on the 12th, and for the asset-backed securities support program on the 21st, via the Responsible Investment Platform (gmi.go.kr). Detailed information on announcements, eligibility, and support can be found on the Ministry’s website (mcee.go.kr) or KEITI’s website (keiti.re.kr). For inquiries, contact the Ministry’s Green Transition Policy Division (044-201-6706) or KEITI’s Green Investment Support Office (02-2284-1974).