UAE eyes big role in GCC voluntary carbon market by 2025
DUBAI, 3 days ago
The UAE is seeking to strengthen its regional and global position in the voluntary carbon market, anticipating investment opportunities within government initiatives aimed at achieving carbon neutrality by 2050, according to the Abu Dhabi-based Interregional Center for Strategic Analytics.
The regional voluntary carbon market - a platform for companies and individuals to trade carbon credits to offset unavoidable carbon emissions - is poised for solid growth over the next five years and expected to be worth between $10 billion to $40 billion by 2030, according to Boston Consulting Group.
Global estimates indicate that the carbon credit market will be worth more than $50 billion over the same period, it stated.
Interregional pointed out that the UAE has launched a number of ambitious projects to enhance its role in carbon trading, most notably: the Dubai Financial Market’s experimental platform for trading carbon credits during the COP28 conference.), to facilitate financing of environmental projects.
In September 2023, the UAE Carbon Alliance was launched: companies committed to purchasing $450 million worth of African carbon credits to enhance connectivity between the UAE and African carbon markets.
AirCarbon Exchange cameIn Abu Dhabi, as the first fully regulated exchange for carbon trading, it facilitates buying and selling for companies.
ADGM has become the first regulator to treat carbon credits as financial instruments, enhancing transparency in the market.
These platforms facilitate the trading of carbon credits between buyers and sellers, and companies with surplus carbon credits can sell them to companies that need to offset their emissions. All traded credits are verified by globally recognized rating bodies to ensure their credibility.
These platforms contribute to directing funds towards environmental conservation and sustainable development projects, and enhance the reliability of trade in this field.
Interregional explained that within the framework of regulating greenhouse gas emissions, the UAE issued a ministerial decision obligating large companies to monitor and report their emissions, and it also established the National Carbon Credit Registry to promote trade in this field.
