China raised 6 billion yuan ($826 million) in its first-ever green sovereign bond sale, highlighting the country’s ambitions to bolster its environmental credentials to investors.

With more than 47 billion yuan of investor bids, the three-year and five-year offshore yuan-denominated notes were priced at 1.88% and 1.93% respectively, according to a person familiar with the matter. The yields were tightened from around 2.3% and 2.35% at initial price discussions.

The green securities will be listed in Hong Kong and an application will be made to the London Stock Exchange so that they could be traded there, the person added. The arrangement underscores China’s efforts to build closer financial ties with the UK and the nation’s intentions of tapping the world’s largest buyers of sustainable debt — European investors.

The coupon rates are about one and two basis points lower than the bid yields to maturity on the non-green renminbi sovereign notes that were sold in Hong Kong in February, according to Bloomberg-compiled data.

The issuance allowed investors to directly engage with China’s finance ministry “to talk about its plans, the state of economy, its decarbonization strategy,” said Xuan Sheng Ou Yong, sustainable fixed-income lead for Asia-Pacific at BNP Paribas Asset Management in Singapore. “Even the opportunity to have a meeting, that’s unprecedented.”

The debt issuance plan was first made public in January, when the UK Chancellor of the Exchequer visited Beijing and both countries pledged to enhance financial cooperation and boost capital market partnerships. It also comes as China ramps up offerings in overseas markets, including a $2 billion bond sale in Saudi Arabia in November and a €2 billion ($2.2 billion) deal in Paris in September.

While global issuance of green bonds slowed in the final three quarters of 2024, Chinese entities are the largest issuers of the notes so far this year, data compiled by Bloomberg Intelligence show.

The move will encourage more Chinese entities to seek funding in the international sustainable finance market, which will diversify their funding sources as they transition to low-carbon practices, according to John Wang, an analyst at Moody’s Ratings.

China, the world’s top polluting nation, is on track to peak its greenhouse gas emissions potentially ahead of a 2030 deadline. The nation is pursuing a range of initiatives to accelerate decarbonization, including work to expand its emissions trading market and to extend its rapid uptake of renewable energy, Premier Li Qiang said last month.