By Doaa Farid
A recent report by the International Finance Corporation (IFC), a member of the World Bank group, estimated potential investments of up to $1tn in the fields of renewable energy, resource efficiency and climate change adoption across emerging Europe, Central Asia, Middle East and North Africa (EMENA), according to a Wednesday press release.
The IFC report, which covers 49 countries, assessed the potential for “climate-smart” investment in a region facing increases in energy demand, population growth and urbanisation, as well as needs for improved infrastructure for more efficient industry, transport and utilities.
The report estimated potential investments worth $640bn up through 2020 across the region, including: $270bn in the fields of renewable energy generation, rehabilitation of power infrastructure, and improved transmission and distribution; and $240bn in energy efficiency in the commercial and consumer sectors, via building insulation, appliance upgrades, lighting, and water and space heating.
It also expected a $60bn investment in cement, metals, and manufacturing, via improved industrial processes and equipment upgrades, and $70bn in improving water usage.
“In the Middle East and North Africa (MENA) region, the renewable energy sector needs $45bn worth of investments,” the report said adding that the agriculture sector in the region could spend up to $ 30bn improving its water efficiency.
IFC Vice President for Europe, the Middle, East, and North Africa Dimitris Tsitsiragos said that more investments are needed in the coming decades to meet the demands of emerging economies “and much of that investment will come from the private sector.”
“This report showed that many businesses are already successfully investing in climate-smart business,” Tsitsiragos said.
IFC is focused on private sector investment in climate-smart businesses with a goal to invest $3bn a year globally in climate-smart projects by 2015, and to tie at least 20% of long-term financing directly to climate change, according to the report. It has invested $2.5bn in MENA in climate-smart business in the last four years.
The report was released with last week’s Climate Business Forum, organised by the Financial Times and IFC, in collaboration with A.T. Kearney, the global management consulting firm, and Eco and sustainable energy sector specialists.
IFC is the largest global development institution focused on the private sector.
