UAE uses COP28 to announce the launch of a $30b climate-focused investment vehicle
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During the recent Conference of The Parties (COP28) in Dubai, the UAE announced that it is setting aside a $30 billion investment, which will be used to launch a climate-oriented investment vehicle. The country intends to use this opportunity to establish a transparent climate finance system and provide funding and access to the Global South.
"On Friday, we launched the world’s largest private market climate vehicle, Altérra, which aims to mobilize up to $250 bn in climate investment, with a focus on the Global South. The UAE has also committed $2.6 billion as part of the Africa Clean Energy Initiative alongside a…
— COP28 UAE (@COP28_UAE) December 4, 2023
The UAE reveals its global climate finance plan
According to the UAE’s announcement, the new climate-focused investment vehicle will be known as ALTERRA. It will serve as the largest private investment commitment for climate change. The goal is to help emerging markets by funding climate change programs, with the intention of mobilizing $250 billion by 2030.
ALTÉRRA is dedicated to catalyzing climate change investment and solutions and aims to mobilize $250 billion worldwide by 2030, with a particular emphasis on emerging markets and developing economies.@Alterrafund#COP28 #UniteActDeliver #ALTÉRRA pic.twitter.com/JA5RzPrrxF
— COP28 UAE (@COP28_UAE) December 1, 2023
The initiative will speed up the worldwide shift to net zero and help decarbonize at a faster, more efficient pace. The UAE also said that COP28 Director-General Ambassador Majid Al-Suwaidi will lead ALTERRA alongside a group of climate experts.
The project is also seeing the participation of an investment managing company from the UAE, Lunate, which is actually the entity that established the project. ALTERRA has a two-part configuration, which is expected to incentivize regulation and help form strategies for using capital in the most efficient way across the worldwide climate economy.
The focus will be on several key objectives that the COP28 Action Agenda came up with, including sustainable living, industrial decarbonization, energy transition, and development of climate technologies.
Two sides of the ALTERRA initiative
Commenting on the initiative, COP29 President Dr. Sultan Al Jaber stated that ALTERRA provides a transformational solution for attracting private capital. He added that its structure and scale will lead to the creation of a multiplier effect in the climate-oriented investment sector.
As a result, this will be a vehicle unlike any other that exists at this time. Dr. Sultan Al Jaber will also be the chair of ALTERRA’s board, and he added that the launch of the initiative reflects the COP Presidency’s Action Agenda and the UAE’s efforts to ensure the accessibility, availability, and affordability of climate finance.
Climate finance turns the will for change into climate action, but it needs to be available, accessible, and affordable.
✅The COP28 UAE Declaration on A Global Climate Finance Framework is a 10-point roadmap for the future of climate finance.
✅ The UAE's new ALTÉRRA fund is… pic.twitter.com/1f4kccoj8v
— COP28 UAE (@COP28_UAE) December 2, 2023
ALTERRA will be the overarching initiative, but under it, it will have two components — ALTERRA ACCELERATION and ALTERRA TRANSFORMATION. ALTERRA ACCELERATION will primarily focus on climate resilience, and it will allocate funds in climate and decarbonization strategies.
Meanwhile, ALTERRA TRANSFORMATION will seek to address the Global South’s lack of capital. Another one of its tasks will be the creation of new opportunities, which will be expected to attract new investments.
Speaking on the matter, Ambassador Al Suwaidi said that the initiative will be the crucial element of the UAE’s efforts to build a global green finance ecosystem, which will stimulate and empower the growth of the new climate economy.
