COP28 in Dubai: UAE financial institutions to mobilize Dh1 trillion in sustainable finance by 2030 – News

The UAE’s banking and finance sector will mobilize more than Dh1 trillion ($272.5 billion) in sustainable finance by 2030, senior officials said at the 28th United Nations Climate Change Conference (COP28) in Dubai on Monday.

Khaled Mohamed Balama, Governor of the UAE Central Bank, said the banking sector will need to contribute to both the UAE’s medium-term economic plans and the Net Zero 2050 Strategy.

“Critically this requires funding corporate clients’ climate adaptation and transition strategies, including carbon-intensive sectors, but also allocating new funds to green projects,” he said.

Balama added that the current economic and sectoral structure of many countries means that the challenge facing financial institutions is significant.

Khaled Mohamed Balama. – Photo supplied

The UAE Net Zero 2050 strategic initiative is a national drive to achieve net zero emissions by 2050, which is aligned with the Paris Agreement.

Addressing the impacts of climate change is an immediate need and key to achieving sustainable socioeconomic growth for all countries in the world.

According to the Climate Policy Initiative’s (CPI) Global Climate Finance Outlook 2023, average annual flows in 2021-22 reached almost $1.3 trillion, doubling compared to 2019-20 levels.

Moody’s Investors Service said the climate exposure of large global banks has increased over the past three years, but they still do not report in detail on how climate change could affect their financial performance.

Moody’s analysts said banks will be actively involved in issuing new types of climate-focused instruments such as blue bonds and debt-for-nature swaps to complement their diversified funding sources. In 2023, it expects global sustainable bond issuance to reach $950 billion, only slightly below the 2021 peak of $1.1 trillion.

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