Mexico Advances Sustainable Finance With SDG Bonds

Mexico’s Ministry of Finance and Public Credit (SHCP) completed the placement of sovereign bonds linked to the Sustainable Development Goals (SDGs) in the European market, strengthening the country’s sustainable financing strategy and advancing part of the external funding planned for the year.

On Jan. 12, 2026, the SHCP completed the placement of €4.75 billion (US$5.54 billion) in sustainable bonds, taking advantage of favorable conditions in the European market. This operation allowed the federal government to improve its liquidity position, diversify its funding sources, and optimize public debt management for the remainder of the fiscal year.

In total, three bonds were issued. The first was a five-year bond, with a 3.875% coupon rate and a total amount of €2 billion. The second was a 10-year bond for €1.75 billion, with a 4.875% coupon rate. The final tranche was a 14-year bond, amounting to €1 billion, with a 5.375% coupon rate. The ministry highlighted that through this issuance, Mexico strengthened its euro-denominated sovereign yield curve by establishing three liquid benchmark points, aimed at facilitating access to financing for future sustainable issuers from both the public and private sectors.

SHCP revealed that total demand for the bond placement reached €13.5 billion, equivalent to 2.84 times the amount issued, with orders received from more than 180 international investors. “This result demonstrates the strong appetite of global investors for instruments issued by the Mexican government, even in a complex geopolitical context,” the ministry noted.

The agency also recalled that, to date, the federal government has developed four sustainable benchmark curves in euros, US dollars, pesos, and yen, through 56 labeled bonds with a cumulative amount of US$32.45 billion, positioning Mexico as one of the leading SDG bond issuers in Latin America.

SHCP emphasized that this transaction advances a significant portion of the external financing program planned for 2026, allowing for greater flexibility in debt management during the rest of the year. The operation also supports a more efficient management of the external debt calendar, in line with the 2026 Annual Financing Plan.

The issuance was carried out under the recently updated Sovereign Sustainable Financing Framework, which expands the categories of Eligible Sustainable Expenditures and strengthens eligibility and traceability criteria. The new framework, published on Jan. 7, updates the original framework released in 2020 and aims to contribute to reducing social inequalities and addressing the effects of climate change, in alignment with the 2030 Agenda and the Sustainable Finance Mobilization Strategy.

The United Nations Development Programme (UNDP), acting as an independent observer, noted that the updated framework continues the efforts of the Mexican government to strengthen sustainable finance, consolidate the sustainable yield curve, and attract investors committed to Environmental, Social, and Governance criteria.

UNDP recognized several new features of the framework that strengthen the sustainable finance ecosystem. These include:

• The expansion of the range of sustainable financial instruments beyond sovereign bonds;

• Broader thematic coverage of sustainable financial instruments through the incorporation of additional SDGs and labels;

• Strengthening governance mechanisms and maintaining external controls in the processes for selecting eligible expenditures and in allocation and impact reporting;

• Institutionalization of the application of the Mexican Sustainable Taxonomy (MST) as an analytical framework for eligible sustainable expenditures, incorporating climate and gender-equality objectives based on technical criteria;

• Clear identification of the potential target populations for eligible sustainable expenditures;

• Transparency in selection criteria and the geographic targeting of resources; and

• Certainty regarding scenarios for updating the provisions established in the framework.

Finally, the organism acknowledged the continuity of provisions that strengthen traceability and complementarity across different types of indicators. It also highlighted the use of the methodology linking budgetary programs to SDG targets as a central input in the selection of eligible sustainable expenditures.