The UAE has succeeded where other COP hosts have failed: to rally over 190 nations to agree on a deal to “transition away” from fossil fuels. It has only taken 30 years, and an oil producer to seal the deal.
There was an incredible amount of attention given to the fact that it was the UAE hosting the 2023 United Nations Climate Change Conference or Conference of Parties (COP28); even more so because the climate talks were presided over by an “oil man”, Sultan Ahmed Al Jaber, the head of the Abu Dhabi National Oil Company.
This confirms what many Islamic finance practitioners have argued for when it comes to oil-producing nations tackling the issue of climate sustainability: it takes one in the game, to know how to win it.
The Islamic finance industry’s expectations for COP28 were also high; many were hopeful that the fact it was hosted by an Islamic finance giant, it would mean meaningful deals incorporating Shariah compliant instruments, or initiatives that would lend more credibility to Islamic finance as a sustainable finance solution at an international stage. Some initiatives were announced on the sidelines of COP28, but were they at the level practitioners were hoping for? Let’s just say, more could have been done.
Still, landmark deals were made – the fossil fuel language was one, the monetary pledges toward the loss and damage fund another. But, vulnerable and poor nations still need hundreds of billions to fund their transition away from hydrocarbons and to tackle the very real effects of climate change.
There is still a lot of work to be done, and there is still tremendous opportunity for Islamic finance to be part of the solution. As we explore in this year’s Islamic Sustainable Finance & Investment Annual Report, we have seen encouraging, groundbreaking deals and measures supporting the ESG agenda. We trace some of the most important developments and highlight some landmark transactions. And we look forward to more to come.”
Vineeta Tan,
Managing Editor
REDmoney Group