Sri Lanka’s sustainable finance sector has gained regional recognition at the Environmental Finance Sustainable Debt Awards 2026. This progress has been driven in part by the European Union#funded Green Recovery Facility, implemented by Expertise France. The Facility is a EUR 5 million initiative that aims to turn sustainability into tangible economic opportunities, driving both growth and resilience. In key areas such as sustainable energy, circular economy, climate action, and sustainable finance, the Facility helps the government and businesses identify key actions, while stimulating innovation and unlocking public and private sector investment.

In line with its Global Gateway strategy, the European Union (EU) is fostering green investment in Sri Lanka, and in this context, supports the development of the green bond market to channel private finance into climate#resilient and sustainable projects. Since 2023, this EU-funded support, implemented by Expertise France, has contributed to improving market frameworks, enhancing institutional capacity, and building investor confidence in Sri Lanka’s sustainable finance landscape.

The initiative plays a central role in strengthening Sri Lanka’s Green, Social, Sustainability and Sustainability-Linked (GSS+) bond market. It works in close collaboration with the Colombo Stock Exchange (CSE) and technical partners to align local issuances with international standards.

As a result, recent GSS+ bond issuances have mobilised approximately LKR 85 billion (EUR 186 million), financing priority sectors, including renewable energy, energy efficiency, water and coastal resilience, and inclusive social infrastructure. Several of these issuances were oversubscribed, reflecting growing market demand.

Sri Lanka’s regulatory environment has also been strengthened with the introduction of the GSS Bonds Regulatory Framework in 2025, further improving transparency and positioning the country more competitively in international capital markets.

At the 2026 awards, Sri Lankan financial institutions received multiple regional recognitions, underscoring their growing leadership in sustainable finance across Asia and the Pacific (APAC). DFCC Bank was honoured with the Innovation Award for its Green Bond – Use of Proceeds in APAC, while Bank of Ceylon received the Innovation Award for its Sustainability Bond Structure in APAC. Commercial Bank of Ceylon was also recognised, securing the APAC Green Bond of the Year award in the Financial Institution category.

These recognitions come at a crucial point in Sri Lanka’s economic recovery, sending a strong signal to global investors about the country’s ability to structure credible, standards-based financial instruments.

As part of efforts to sustain this momentum, the Green Recovery Facility is rolling out a targeted capacity-building programme in early May 2026 to strengthen national coordination of GSS+ bonds in Sri Lanka.

The initiative brings together over 160 participants, including senior executives and technical professionals from financial institutions. It combines a high-level C-suite session with a two-day Training of Trainers programme focused on bond structuring, issuance processes, and investor engagement. It is part of a EUR 200,000 initiative under the Facility, supporting the national coordination of GSS+ Bonds, in collaboration with the Securities and Exchange Commission of Sri Lanka (SEC), CSE, Ministry of Finance of Sri Lanka, and the Central Bank of Sri Lanka.

Dr Johann Hesse, the Head of Cooperation at the EU Delegation, noted, “When Sri Lanka develops a strong market for green and social bonds, both sides gain. Sri Lanka unlocks longer#term finance for its transition, and European investors gain reliable, climate#aligned opportunities in a key partner economy”.

The programme is expected to create a multiplier effect across the sector, reaching over 300 professionals as knowledge and best practices are shared across participating institutions, in collaboration with the Colombo Stock Exchange and key regulatory stakeholders.

 The European Union’s cooperation with Sri Lanka on sustainable finance reflects shared interests. For the EU, stronger green and social bond markets in partner countries help create more resilient, transparent and climate#aligned supply chains and investment opportunities. For Sri Lanka, they expand access to long#term finance for clean energy, climate resilience and inclusive growth. This initiative is part of the EU’s wider engagement in line with the Global Gateway strategy, which seeks to mobilise sustainable investment with trusted partners on the basis of mutual benefit and high standards.