The 2021 UN Climate Change Conference (COP26) saw a number of important commitments, including the UAE’s roadmap net zero by 2050, announced a few weeks prior to the conference.
Recognising the challenges ahead, there was a clear need for national action to go further, with more detailed and inclusive plans, if the region is to undergo a meaningful transition. This includes an effective financing approach, including harnessing the power of the region’s Sovereign Wealth Funds (SWFs) and the appetite of financial instructions and companies to transition their business models, albeit with challenges remaining in carbon-intensive industries.
The Middle East is now at the heart of the energy transition conversation with COP27 and COP28 taking place in Egypt 2022 and the UAE in 2023 respectively.
Looking ahead, and in order to assess some of the critical success factors in the UAE’s decarbonisation plans, Abu Dhabi Global Market (ADGM) – the international financial centre located at the heart of the UAE’s capital city –published a white paper entitled “UAE and the Energy Transition: Towards COP28.” The paper, supported by BNP Paribas, summarises insights from members of the UAE’s business and regulatory communities following a round table held in November 2021. The Chatham House discussion hosted special guest Craig Leeson, award winning journalist, filmmaker and BNP Paribas Global Sustainability Partner.
“The UAE’s hosting of the COP28 next year will be an important determinant of the impact of our efforts to decarbonise our economy, said Mercedes Vela Monserrate, Head of Sustainable Finance at Abu Dhabi Global Market. “Our discussion with BNP Paribas, as well as with other private sector partners, set the scene for a more collaborative approach to clearly defining how to achieve net-zero goals. We should continue to integrate the private sector into our transition strategy, and set clear, actionable plans in line with global standards.”
Key findings from the paper include:
- There must be an increased focus on public-private sector collaboration, the setting of clear, credible plans and timelines to deliver on net zero targets and effective stakeholder engagement across all segments of society
- The role of governments and regulators will be key to ensure effective reporting on climate action, with increased disclosure a key enabler of progress
- A toolkit for financing the transition should include government incentives, support from regional SWFs, and financial institutions dedicated to ESG.
- Action must be taken to ensure the transition is just, with support provided the individuals, communities, regions and industries which are particularly vulnerable.
BNP Paribas is proud to partner with ADGM to engage with key regional stakeholders on the energy transition and the path to net zeroFrancois Regnier, Country Head of the UAE
“BNP Paribas is proud to partner with ADGM to engage with key regional stakeholders on the energy transition and the path to net zero”, commented Francois Regnier, Country Head of the UAE. “When it comes to climate action, a critical juncture was reached at COP26. As a responsible bank, it is important to share our knowledge and experience of sustainability and sustainable finance to engage more stakeholders. Although somehow distant, we want COP28 to encapsulate not only the progress of prior COPs, but also to include more diverse stakeholders in the planning and delivery of a sustainable future for the planet.”