NEOM unveils progress with new video update 

Jeddah - Yasmine El Tohamy - RIYADH: A “just transition” to net-zero emissions needs fairer financing and cooperation, a senior director at the Organization of the Petroleum Exporting Countries’ development fund has said.

Speaking to Arab News, Shaimaa Al-Sheiby, senior director of Strategic Planning and Economic Services at the body, called for institutions to lead the way by “de-risking” financial investments in developments that could help tackle global warming.

Funding for climate initiatives currently stands at $103 trillion, as opposed to the $150 trillion needed by 2050 to achieve nationally determined contribution targets, according to the International Renewable Energy Agency.

Speaking after appearing on a panel at the Middle East and North Africa Climate Week in Riyadh, Al-Sheiby said: “Private capital is very shy. They go where there is the least risk and therefore, I think that as entities, as sovereign money, we should play a much larger role in attracting private capital by de-risking it.”

She stressed the “absolute need” for project preparation capacity, calling on multilateral development banks to fulfill this role.

“MDBs should start refocusing their own architecture to support through their capacity, through their institutions, in order to deliver projects … to the private sector,” said the senior executive.

The panel was attended by senior banking representatives, private sector individuals, and UN climate advocates who sought to address how finances could be mobilized to tackle global warming.

Bogolo Kenewendo, lead of the UN Climate Change High-Level Champions Team, used the platform to claim the term “just transition” is a “blanket statement,” especially for indebted countries.

“In order to deal with a just transition, we must deal with debt sustainability first,” she added.

In order to address these discrepancies, Riham El-Gizy, CEO of the Regional Voluntary Carbon Market Co., outlined the need to re-instill South-South trust within both the banking and energy sectors.

From 2019-2020, Western Europe and North America acquired an average of $141 billion in private climate finance, whereas South Asia, the Middle East, Africa, and South America received only $37 billion.

The chairman of the Islamic Development Bank outlined these issues earlier this week in his statement at the Climate Week forum.

“If we are talking about the MENA 57 members, 29 of them are the least developed countries, the challenge facing these countries as they try to adapt to these climatic pressures that are happening as we speak — we in the Islamic Development Bank pay a lot of attention to helping these countries in as many ways as we could from a financial point of view,” he said as he called on other financial institutions to play their part in facilitating an even playing field for clean energy development.