Asia Pacific a Bright Spot for Sustainable Finance in 2026: ING

Why It Matters

The shift underscores Asia Pacific’s emerging dominance in ESG capital, reshaping global investment flows and prompting banks to prioritize regional expertise. It signals investors where policy momentum and real‑economy demand will drive future returns.

Key Takeaways

• Asia Pacific sustainable finance volumes hit record in 2025
• Green bonds and loans drove most growth last year
• ING forecasts continued APAC expansion in 2026
• EMEA corporate ESG issuance weakening despite overall size
• Central/Eastern Europe sustainable issuances rose 40% YoY

Pulse Analysis

Asia Pacific’s sustainable‑finance surge reflects a confluence of supportive policy frameworks and tangible demand from sectors such as renewable energy, transport infrastructure, and digital capacity building. Banks like ING have become key coordinators, structuring complex green and transition deals that meet corporate risk‑adjusted return criteria. This market resilience, even amid global geopolitical turbulence, demonstrates that regional regulatory clarity can translate into robust capital deployment, positioning the Pacific as a testing ground for innovative financing structures.

Globally, sustainable‑finance issuance contracted to US$1.557 trillion in 2025, a 6.7% dip from the previous year, yet the region‑by‑region picture is uneven. Europe, Middle East and Africa retain the largest share, but corporate ESG debt is losing steam as issuers gravitate toward conventional, non‑ESG‑linked financing. Conversely, Central and Eastern Europe recorded a striking 40% YoY growth, driven by sovereign and state‑owned entities eager to showcase climate commitments. These dynamics are prompting investors to rebalance portfolios, allocating more capital to regions where policy incentives and pipeline projects align.

Looking ahead to 2026, ING anticipates sustainable‑finance volumes rising to roughly US$1.621 trillion, with Asia Pacific leading the rebound. The outlook hinges on continued policy refinement, the ability of banks to deliver bankable transition solutions, and the management of external shocks such as Middle‑East conflicts that can dampen market sentiment. Stakeholders—investors, corporates, and regulators—should monitor the evolving APAC regulatory landscape and the growing expertise of financial institutions in structuring credible decarbonisation pathways, as these factors will likely dictate where the next wave of ESG capital flows.