UAE President Unveils $30 Billion ALTÉRRA Climate Fund For Climate Finance
The President of the United Arab Emirates, Sheikh Mohammed Bin Zayed Al Nahyan, has unveiled an ambitious climate finance initiative during the COP28 climate summit, which is hosted by the UAE this year. Several global leaders attended this global event, just like the recent G20 Summit.
The UAE President has announced the creation of a $30 billion climate fund, named ALTÉRRA. This substantial fund is not just a standalone figure; it aims to attract a staggering $250 billion in investments by the end of this decade.
The primary goal here is to bridge the gap in climate finance, especially in parts of the world that are critically affected by climate change but often overlooked by investors.
ALTÉRRA Climate Fund
Diving deeper, this fund, ALTÉRRA, is designed to allocate $25 billion specifically for climate strategies. An additional $5 billion is earmarked to encourage investment flows into the Global South.
If you might be wondering let me tell you, the Global South refers to regions primarily in Africa, Latin America, and parts of Asia, which are developing economically and are significantly impacted by climate issues.
Collaboration of Global Asset Managers
A key aspect of ALTÉRRA is its collaboration with renowned global asset managers like BlackRock, Brookfield, and TPG. These partnerships are crucial because they bring in expertise and additional financial muscle.
For instance, BlackRock is committing $1 billion to a private debt strategy focused on climate transition. Brookfield is launching a Catalytic Transition Fund for developing countries, also backed by ALTÉRRA.
What Has Changed?
The UAE had to face criticism for its plans to expand oil and gas production, which are at odds with global efforts to reduce carbon emissions.
There was a time when the UAE was only known for its oil wealth. But now, the country is upgrading its strategies by promoting tourism and driving investment in climate action. After hosting the COP28 successfully, it has created a huge positive impact on the world.
By launching ALTÉRRA and encouraging financial and business sectors to invest in climate solutions, the UAE is trying its best for a noble cause. It’s an effort to balance its economic activities with environmental responsibilities and to play a leading role in the global fight against climate change.
An Initiative To Address Climate Challenges
This initiative of ALTERA Climate Fund signifies a transformative approach towards climate investments, especially in emerging markets and developing economies, where higher risks often deter traditional investments.
ALTÉRRA’s establishment, backed by significant financial commitments and strategic partnerships, marks a notable shift in addressing climate challenges, particularly in under-served regions of the world.