How Egypt, host of UN Climate Change Conference COP27, is spurring a domestic ‘green economy’

A general view of Sharm El-Sheikh International Convention Center, which is hosting the COP27 climate summit. (AFP)
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Updated 07 November 2022
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How Egypt, host of UN Climate Change Conference COP27, is spurring a domestic ‘green economy’

  • From sea level monitoring to aeroponics, locally led initiatives are spearheading the ambitious campaign
  • National Initiative for Smart Green Projects shortlisted 18 schemes to be exhibited at Sharm El-Sheikh summit

CAIRO: When the Red Sea resort town of Sharm El-Sheikh hosts the COP27 UN Climate Change Conference between Nov. 6 and Nov. 18, the Egyption government will use the occasion to promote its National Initiative for Smart Green Projects.

The initiative, launched in August, is designed to encourage foreign investment in Egypt’s many environmental and quality of life projects as part of its Vision 2030 social and economic reform agenda and its National Climate Change Strategy 2050.

From an initial 6,280 projects submitted to the platform from across Egypt’s 27 governorates, just 162 made it through to the final round of judging. At a conference in Cairo on Nov. 3, Mostafa Madbouly, the Egyptian prime minister, announced the 18 winning projects.




Climate change, pollution and exploitation by man is putting existential unsustainable pressure on the Nile, the world's second longest river on which millions of people depend. (AFP)

These 18 projects will be exhibited for international delegations at COP27 and will benefit from financial and technical support.

The projects were divided into categories, including those related to quality of life, women’s economic empowerment, climate change and sustainability, start-ups, and non-profit community initiatives.

They were also divided into categories based on their size. Projects valued at more than EGP200 million were deemed to be large, from EGP50 million to EGP200 million considered medium, and those below EGP50 million classified as small. 

“The key word for this initiative is localization, since it adopts an all inclusive bottom-up approach targeting all Egyptians,” Hesham Badr, national coordinator for the National Initiative for Smart Green Projects, told Arab News.

“It attempts to reach every Egyptian citizen, man or woman, to be part of the climate change challenge and to include them in the solutions process.”

The initiative included women-focused development projects designed to empower them socially and economically and give them equal opportunities in the green economy.

The National Council for Women launched its own campaigns to encourage and support women looking to participate in the project. As a result, there were more than 1,000 submissions in this category alone.

 

 

To qualify, entries had to fulfill certain green and smart components.

The green component encompassed things such as clean energy, cutting emissions, waste management and recycling, and the ability of participants to provide a climate solution to a particular challenge in their village, province or governorate.

The smart component, meanwhile, included the use of mobile applications, the Internet, artificial intelligence, or any other kind of digital technology. The project, or at least one of its phases, also needed to be at the implementation stage to qualify.

“The whole world is looking for solutions, and these are solutions coming from the heart of the Egyptian community, from different villages, and governorates,” said Badr.

“So these are solutions to problems and challenges facing them. For the first time, we have a database of projects that are green and smart in Egypt. We have a mapping of all these projects and their location, whether they are in Al-Dakahlia, Alexandria or Cairo.”

FASTFACT

The 27th UN Climate Change Conference, more commonly referred to as Conference of the Parties of the UNFCCC, is being held from Nov. 6 to Nov. 18 in Sharm El-Sheikh.

The jury tasked with selecting the winning projects was headed by Mahmoud Mohieldin, the UN Climate Change High-Level Champion for Egypt, alongside key figures in the Egyptian government.

There was also an international jury composed of several UN agencies based in Cairo, including the UN Development Programme, the Food and Agriculture Organization, the World Food Programme, the UN Industrial Development Organization, UN-Habitat and UN Women.

Among the winning entries was a project providing smart facility management systems and modern pumping and irrigation to smallholder farmers to help them use water as efficiently and cost-effectively as possible.

Another winning project focused on soilless farming by promoting the use of aeroponics to manage irrigation, ventilation and cooling systems, saving up to 90 percent of irrigation water while providing safe and healthy food products with just 5 percent waste.

Also among the winning projects was a program that can predict extreme weather events and act as an early warning system for potential climate disasters on the Alexandria coast. The project collects data about sea levels at 24-hour intervals using sensors connected to a collection of floats deployed on the Mediterranean.




Concrete blocks are installed along the Mediterranean coast of Egypt's northern city of Alexandria to break the sea waves. (AFP)

Alexandria is considered extremely vulnerable to rising sea levels, making any technology that can monitor long-term changes or predict flooding able to help protect infrastructure and even save lives.

One successful project originating from the southern governorate of Luxor, called the Egyptian Bank for Waste, collects discarded materials from rural areas and recycles them for residential and agricultural use.

The National Initiative for Smart Green Projects is just one program launched by the Egyptian government to expand the green economy. It was during the COP26 summit in Glasgow, Scotland, last year that it launched its National Climate Change Strategy 2050.




Hesham Badr, national coordinator for the National Initiative for Smart Green Projects, said: “The key word for this initiative is localization, since it adopts an all-inclusive, bottom-up approach targeting all Egyptians.” (Supplied)

The strategy has four main targets. The first is about maintaining sustainable economic growth by reducing carbon emissions and by boosting the adoption of renewable energy sources.

The second target is to eliminate greenhouse gas emissions from non-energy activities, the third is aimed at maximizing energy efficiency, and the fourth encourages local green banking and creative financing methods such as green bonds.

Egypt’s Ministry of Finance issued the first sovereign green bond in the Middle East and North Africa in Sept. 2020, valued at $750 million with a five-year term and an interest rate of 5.25 percent.

Green bonds are defined as debt methods issued to obtain financing for climate or environment-related projects.

Egypt is not the only Arab country that is boosting green initiatives. The UAE and Saudi Arabia have committed themselves to net-zero greenhouse gas emissions by 2050 and 2060, respectively. Bahrain has pledged to meet the same target by 2060.

Since the launch of Saudi Vision 2030 in 2016, the Kingdom has taken significant steps to step up climate action and environmental protection through greater reliance on clean energy and offsetting emissions.

The Kingdom is exploring ways to diversify its economy and decarbonize by producing hydrogen using its vast reserves of fossil fuels, from which carbon capture, or blue hydrogen, is produced.




The Saudi Green Initiative was launched in 2021 with the aim of planting 10 billion trees in the Kingdom over the next few decades. (Supplied) 

Saudi Arabia plans to expand beyond blue hydrogen into other, even cleaner forms, such as green hydrogen, which is made by using renewable energy to split water. The NEOM Green Hydrogen Project, to be commissioned in 2026, will be the world’s largest green hydrogen plant powered entirely by renewables.

The Saudi Green Initiative, launched at the inaugural Green Initiative Forum on Oct. 23, 2021, consists of more than 60 initiatives, the first wave of which entails investments worth SR700 billion ($187 billion) designed to contribute to the growth of a “green economy.”

Crown Prince Mohammed bin Salman launched the first Saudi Green Initiative in 2021 with the aim of planting 10 billion trees in Saudi Arabia over the next few decades to eliminate the greenhouse emissions by 278 metric tons annually by 2030.

The second Middle East Green Initiative Summit and the Saudi Green Initiative Forum will take place in parallel with COP27 this month in Sharm El-Sheikh.

 


UBS gets green light to open Saudi branch for banking operations

Updated 23 April 2024
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UBS gets green light to open Saudi branch for banking operations

RIYADH: In a move aimed at enhancing Saudi Arabia’s financial landscape, the Kingdom has granted permission for a branch of the Swiss bank UBS to operate within the nation. 

According to the Saudi Press Agency, the approval was granted during a session chaired by the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al-Saud, held by the Cabinet in Jeddah on April 23.

The session commenced with King Salman briefing the Cabinet on the recent communications and discussions held between the Kingdom and several countries regarding shared relations, regional issues, and global developments, as reported by SPA.

In this context, the Cabinet reaffirmed Saudi Arabia’s steadfast stance toward promoting security and stability in the region and the world. 

The Minister of Media, Salman bin Yousef Al-Dossary, stated in a press release following the session that the Cabinet praised the outcomes of the second ministerial meeting of the dialogue between the Gulf Cooperation Council countries and Central Asian countries. 

He emphasized the Kingdom’s commitment to continue strengthening communication channels with various countries worldwide and supporting areas of joint coordination, including multilateral efforts.

Additionally, the Cabinet expressed its appreciation for the participants of the forthcoming World Economic Forum special meeting, set to take place in Riyadh in the upcoming week, highlighting the Kingdom’s dedication to encouraging global collaboration and tackling shared challenges.

Moreover, the Cabinet announced that the World Bank had selected Saudi Arabia as a center for knowledge dissemination to promote worldwide awareness of economic reforms, underscoring its leadership in achieving significant progress in global competitiveness indicators.

Al-Dossary further highlighted that the Cabinet applauded the achievement of five Saudi cities in obtaining advanced positions in the 2024 Smart Cities Index.

Following today’s session, the Cabinet approved cooperation agreements with Qatar, the Dominican Republic and the UK as well as Turkey, Chad, Portugal, Hong Kong, and Yemen.

Additionally, the body authorized discussions regarding statistical collaboration with Australia and maritime cooperation with Egypt. It also endorsed anti-corruption agreements with South Korea, archival partnerships with Greece, and financial technology collaboration with Singapore.

Authorization was granted for negotiations on science and technology cooperation with the Bahamas. A unified law for international road transport within GCC countries was approved, and additional compensation was granted to Tabah village’s affected families in the Hail region. 

Furthermore, final accounts for various government entities were approved.


UAE and Oman establish $35bn investment partnerships across multiple sectors 

Updated 23 April 2024
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UAE and Oman establish $35bn investment partnerships across multiple sectors 

RIYADH: Trade and economic ties between the UAE and Oman are set to further strengthen thanks to the signing of investment deals worth 129 billion dirhams ($35.12 billion).  

According to a press statement, these agreements cover multiple sectors, including renewable energy, green metals, railway, digital infrastructure, and technology investments. 

Economic ties between the UAE and Oman have remained robust in recent years, with non-oil trade volumes reaching approximately 50 billion dirhams in 2023. 

“The UAE and Oman have strong historical relations that are founded on shared values, goals and principles. The agreements represent a major milestone in our bilateral ties, as they pave the way for us to leverage our collective strength to realize our shared vision of advancement and prosperity,” said Mohamed Hassan Al-Suwaidi, UAE’s minister of investment.  

One of the major agreements signed by both countries was an industrial and energy megaproject valued at 117 billion dirhams. This project encompasses renewable energy initiatives, including solar and wind projects, alongside green metals production facilities. 

The deal’s signatories included Abu Dhabi National Energy Co., Abu Dhabi Future Energy Co., and Emirates Global Aluminium, as well as Emirates Steel Arkan, OQ Alternative Energy, and Oman Electricity Transmission Co. 

Another agreement, valued at 660 million dirhams, was signed between Abu Dhabi Developmental Holding Co. and Oman Investment Authority to establish a technology-focused fund. 

A UAE-Oman rail connectivity project, valued at 11 billion dirhams, was also inked by both countries. 

Additionally, UAE’s Ministry of Investment and the Ministry of Commerce and Trade signed another deal with Oman’s Ministry of Investment Promotion to cooperate in multiple sectors, including digital infrastructure, food security, and energy. 

Etihad Rail, Mubadala, and Omani Asyad Group Co. signed a shareholding partnership valued at 3 billion dirhams. 

Both countries also announced the formation of a UAE-Oman alliance to enhance bilateral economic and trade relations. 

The UAE’s Ministry of Investment, in the press statement, further noted that the signing of these agreements will serve to bolster relations across key sectors and foster socio-economic benefits, contributing toward a stable and prosperous future for both countries. 


Influx of Chinese models to drive Mideast EV sales amid global surge

Updated 23 April 2024
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Influx of Chinese models to drive Mideast EV sales amid global surge

  • The IEA report disclosed that global EV sales grew by approximately 25 percent in Q1 of 2024

RIYADH: The entry of Chinese car models in the Middle East could drive regional electric vehicle sales, as global figures are projected to reach 17 million units by 2024. 

According to the latest International Energy Agency report, this marks a 21.42 percent increase from the previous year, with nearly 60 percent of new electric car registrations in 2023 occurring in China, followed by 10 percent in the US and 25 percent in Europe. 

“The continued momentum behind electric cars is clear in our data, although it is stronger in some markets than others. Rather than tapering off, the global EV revolution appears to be gearing up for a new phase of growth,” said Fatih Birol, executive director of the IEA. 

The Global EV Outlook 2024 stated that the electric car market in Africa, Eurasia, and the Middle East is still in its nascent stage, with such vehicles representing just under 1 percent of total sales in these regions. 

However, the decision of Chinese carmakers to explore these regions, along with producing vehicles domestically, could change this trend, allowing the market to expand in the coming years. 

“In Uzbekistan, BYD (Chinese automaker) set up a joint venture with UzAuto Motors in 2023 to produce 50,000 electric cars annually, and Chery International established a partnership with ADM Jizzakh,” stated the IEA in the report.  

This partnership has already led to a steep increase in electric car sales in Uzbekistan, reaching around 10,000 in 2023. 

It added: “In the Middle East, Jordan boasts the highest electric car sales share, at more than 45 percent, supported by much lower import duties relative to ICE (internal combustion engine) cars, followed by the UAE, with 13 percent.” 

Moreover, in July last year, Saudi Arabia’s Ministry of Investment signed a $5.6 billion deal with Chinese electric car maker Human Horizons to collaborate on the development, manufacture, and sale of vehicles. 

Steady growth  

The IEA report disclosed that global sales of electric cars grew by approximately 25 percent in the first quarter of this year compared to the same quarter in 2023. 

Highlighting the growth of the EV market, the report revealed that the number of electric cars sold globally in the first three months of this year is roughly equivalent to the total units sold in 2020. 

The steady growth in the first quarter of this year was driven by China, with 1.9 million EVs sold, marking a 35 percent rise compared to the same period in 2023. 

In Europe, the first quarter of 2024 witnessed year-on-year growth of over 5 percent, slightly surpassing the growth in overall car sales and thus maintaining the EV sales share at a similar level to that of last year. 

The US also experienced a 15 percent increase in sales in this segment during the first three months of this year, compared to the same period in 2023. 

According to Birol, the rise in investments in the electric battery sector is a strong indication of the rise of the EV appetite globally. 

“The wave of investment in battery manufacturing suggests the EV supply chain is advancing to meet automakers’ ambitious plans for expansion. As a result, the share of EVs on the roads is expected to continue to climb rapidly,” said the executive director of IEA. 

He added: “Based on today’s policy settings alone, almost one in three cars on the roads in China by 2030 is set to be electric, and almost one in five in both the US and the EU. This shift will have major ramifications for both the auto industry and the energy sector.” 

EV prices to fall  

The report highlighted that the pace of the transition to EVs may not be consistent and will hinge on affordability. 

IEA added that manufacturers have taken significant steps to deliver on the strengthening EV ambitions of governments by making significant financial commitments. 

“Thanks to high levels of investment over the past five years, the world’s capacity to produce batteries for EVs is well positioned to keep up with demand, even as it rises sharply over the next decade,” said the report. 

According to the intergovernmental organization, more than 60 percent of electric cars sold in 2023 were already less expensive to buy than their conventional equivalents in China. 

However, the purchase prices for cars with internal combustion engines remained cheaper on average compared to EVs in the US and the EU. 

The report suggested that intensifying market competition and improving battery technologies are expected to reduce the prices of electric cars in the coming years. 

“Even where upfront prices are high, the lower operating costs of EVs mean the initial investment pays back over time,” said IEA. 

Moreover, growing electric car exports from Chinese automakers, which accounted for more than half of all electric car sales in 2023, could add to downward pressure on purchase prices. 

IEA also underscored the vitality of ensuring the availability of public charging slots to maintain the steady growth of the electric car market globally. 

According to the report, the number of public charging points installed globally was up 40 percent in 2023 compared to 2022, and growth for fast chargers outpaced that of slower ones. 

However, IEA added that charging networks globally need to grow sixfold by 2035 to meet the level of electric vehicle deployment in line with the pledges made by governments. 

“At the same time, policy support and careful planning are essential to make sure greater demand for electricity from charging does not overstretch electricity grids,” concluded the report. 


Closing Bell: Tasi slips for the second consecutive day

Updated 23 April 2024
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Closing Bell: Tasi slips for the second consecutive day

RIYADH: Saudi Arabia’s Tadawul All Share Index continued its downward trend for the second consecutive day as it shed 24.52 points to close at 12,484.41. 

The total trading turnover of the benchmark index was SR8.44 billion ($2.25 billion), with 71 of the listed stocks advancing and 157 declining. 

On the other hand, Saudi Arabia’s parallel market Nomu gained 95.74 points on Tuesday to close at 26,691.96. 

However, the MSCI Tadawul Index slipped by 0.24 percent to 1,563.40. 

The best-performing stock of the day was United Cooperative Assurance Co. The firm’s share price rose by 6.67 percent to SR13.44.

Other top performers include Etihad Atheeb Telecommunication Co. and Gulf Union Alahlia Cooperative Insurance Co., whose share prices surged by 4.84 percent and 4.54 percent, respectively. 

The worst performer in the main market was Fitaihi Holding Group, as its share price slipped by 4.77 percent to SR4.19. 

The parallel market’s positive performance was driven by Osool and Bakheet Investment Co., whose share price soared by 7.83 percent to SR36.50. 

On the announcements front, Middle East Paper Co. said it has started its cardboard factory project, which will have a production capacity of 450,000 tonnes. 

In a statement to Tadawul, MEPCO revealed that the feasibility study for the project has been completed with a final budget of SR1.78 billion. 

The company went on to say that the undertaking would be completed in 42 months. 

The initiative will be funded by the MEPCO’s internal resources, by long-term loans from local banks and the use of funds resulting from the issuance of the shares to Saudi Arabia’s Public Investment Fund, the statement added. 

Meanwhile, in another statement, MEPCO revealed that it signed another agreement with J.M. Voith SE & Co. KG, for manufacturing, supplying and supervising the installation of the main machine for the cardboard project.


Egypt increases funding needed in 2024-2025 budget by over $59bn 

Updated 23 April 2024
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Egypt increases funding needed in 2024-2025 budget by over $59bn 

RIYADH: Egypt has increased the amount of funding required in its 2024-2025 budget by over 2.8 trillion pounds ($59 billion) following successive shock waves.

In the financial statement of the new draft budget, Minister of Finance Mohamed Maait highlighted that the changes are reflective of the continuous struggles that the North African country has been facing following the COVID-19 epidemic. 

The added funding aims to alleviate the inflationary effects that have been burdening the Egyptian public, improve the standard of living, and meet the developmental needs of citizens, the report said. 

The allocation of spending in the budget will also seemingly reflect the needs of individuals by increasing spending on health and education and aiming to improve job opportunities. 

Egypt’s economy has witnessed blows over the last half year due to the ongoing crisis in Gaza, which has slowed tourism growth and cut into Suez Canal revenue, two of the country’s biggest sources of foreign currency.

Amid a staggering shortage of foreign currency and rapidly increasing inflation, the challenges prompted the International Monetary Fund to expand its financial support to Egypt to $8 billion in an attempt to shore up the country’s economy.

In a statement in March, the IMF board said its decision would enable Egypt to immediately receive about $820 million.

Similarly, the UAE, represented by a private consortium led by the Abu Dhabi Developmental Holding Co., signed a landmark agreement with Egypt in February to invest $35 billion in Ras El-Hekma, a region on the Mediterranean coast 350 km northwest of Cairo. 

Since securing the deal, which marked the single largest foreign direct investment in the North African country, the nation launched some long-sought reforms with the central bank delivering a 600 basis-point interest rate hike and a pledge to unshackle its currency alongside a devaluation.

This led S&P Global Ratings to note that it has been encouraged by the rush of financial support to Egypt, therefore lifting its economic outlook for the country to positive from stable after the long-awaited currency devaluation, which is poised to ease foreign currency shortages.