MOMENTUM FOR SUSTAINABLE FINANCE GROWS AS CAIRO JOINS FC4S
Cairo, 27 June 2019 – Cairo today became the latest member to join the International Network of Financial Centres for Sustainability (FC4S), a UN Environment Programme-convened movement of financial centres committed to ensuring that sufficient private capital is directed at climate-friendly and green investments.
Cairo is the 26th member of FC4S and the fourth major new financial centre to join in the last month, following Beijing, Lagos and Tokyo in a surge of support for sustainable finance.
“Similar to other countries across the globe, climate change has direct and indirect economic, social and environmental risks to Egypt's path to development and can be a threat to current efforts of economic reform,” said Mohammed Omran, Chair of Egypt’s Financial Regulatory Authority, the single regulator that has oversight on non-bank financial services such as the nation’s stock exchange and capital market activities, insurance and private pension funds, mortgage, leasing, factoring and micro finance.
“It is therefore in the best interests of all Egyptian stakeholders – policy makers and investors alike – to invest in a low-carbon and sustainable future,” he added. “Cairo’s entry into the ranks of financial centres is an important step in ensuring a sustainable future for our country and in contributing to a gradual transition of our economy to a green and circular model.”
The city is the key financial centre in Egypt and regionally. The Egyptian stock exchange has long been a pioneer in sustainable finance, while Finance Minister Mohamed Maait earlier this year told Bloomberg that up to USD 500 million worth of green bonds – a first for the country – are in the works. Cairo is the second FC4S member from the Arab-speaking world, after Abu Dhabi, and the fourth member on the African continent.
“I am very excited to welcome Cairo to the FC4S fold,” said Stephen Nolan, Managing Director of FC4S. “We need to unlock trillions of dollars to finance the fundamental shift the world needs, and the inclusion of this iconic city adds welcome momentum to this quest.”
While green and sustainable finance is growing, the levels dedicated to delivering on the Paris Agreement and the Sustainable Development Goals are still insufficient. For example, the World Resources Institute estimates that USD 5.7 trillion will need to be invested annually in green infrastructure by 2020. However, 2018 research by the United Nations Framework Convention on Climate Change found that climate finance had hit only USD 681 billion annually by 2016. Private sector investment is crucial to make up the shortfall.
“In the past month, we have seen two major African cities and two major Asian cities commit to greening their financial centres,” said Satya S. Tripathi, UN Assistant Secretary-General and Secretary of the UN Environment Management Group. “This is testament to the growing willingness of the private sector to shift their focus to tackling issues such as runaway climate change, biodiversity loss and planetary scale pollution.”
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