The UK government is working with partners across North Africa to ensure country governments and their financial sector industries have the knowledge and skills to play active roles in the unlocking of the finance needed to tackle the global climate crisis.
As the UK Embassy in Egypt marks 150 days until COP27 at Sharm El Sheik, Tetra Tech’s Amy Shaw and Abigail Dunleavy are highlighting the work they are doing on the FCDO’s North Africa Technical Assistance Facility, which is building capacity within North African financial institutions and equipping them with knowledge that is key to a sustainable future.
Financial sector stakeholders must play their part towards unleashing the trillions in private and public sector finance required to secure global net zero. As such, mobilising finance was a key goal of COP26. Looking forward to COP27, to achieve global climate goals, every company, every financial firm, every bank, insurer and investor must continue to change.
A key driver of positive change is improving the sustainable finance literacy of financial institutions and those involved across these industries. Through the North Africa Technical Assistance Facility, Tetra Tech International Development has been working with UK Embassies in Morocco, Tunisia, Algeria and Egypt to deliver a series of training courses to financial stakeholders and regulators. The goal of these trainings is to encourage key decision makers to embed sustainable finance practices in their jurisdiction.
Known as the Regional Sustainable Finance Project, these trainings have been delivered in three courses across North Africa, in partnership with the Climate Bonds Initiative, the Public and Third Sector Academy for Sustainable Finance (P3S Academy) at the University of Oxford and the London Institute of Banking and Finance (LIBF). These trainings have covered a spectrum of thematic areas aimed at developing sustainable finance literacy.
Cognisant of the rapid growth and relevance of the green bond market, the Climate Bonds Initiative delivered the first course to provide regional participants with an understanding of how green bonds can be a tool to tackle climate change and to promote sustainable development. The second course was delivered by Oxford University’s P3S Academy, who led participants through an online Introduction to Sustainable Finance course that identified the policy mechanisms available to successfully motivate greater investment needed to deliver sustainability. The third and final course was delivered by LIBF, who delivered a total of 24 hours of interactive training to provide senior leaders from across the financial sector with an understanding of technicalities of climate risk, from risk management techniques to disclosure requirements.
Between December 2021 and May 2022, this project has trained over 100 Tunisian, Algerian, Moroccan and Egyptian representatives from financial and regulatory institutions, including Ministries of Finance from across the region, Bank Al-Maghrib, Banque d’Algérie and the Casablanca Stock Exchange, and regulators such as Egypt’s Financial Regulatory Authority (FRA) and Tunisia’s Conseil Du Marche Financier (CMF).
In addition, the UK government targeted future Independent Green Bond Verifiers in the Egyptian market. In collaboration with the Egyptian FRA’s Regional Center for Sustainable Finance, this specialised Climate Bonds Initiative course trained 22 potential green bond verifiers. The verification process is one of the most important steps in thematic-labelled bond issuances, a rigorous scientific criterion which ensure that certified issuances are consistent with the Paris Agreement. Training Green Bond Verifiers will raise the credibility of Egypt’s green bond market by building a network of local experts who are able to sign off on green bond issues in Egypt in the future.
Feedback from senior leadership taking part in the courses has demonstrated the value of investing in improving sustainable finance literacy. One participant said “[I] will share my knowledge with my team and do the necessary due diligence to integrate climate risks in the global risk mapping,” with another participant committing to feeding back “lessons learned to top level management, taking steps into greener options.”
With 150 days to go before COP27 kicks off in Sharm el Sheikh, the NATAF Regional Sustainable Finance Project has played a key role in helping these countries to actively contribute towards tackling climate change. The result is markedly increased capacity within North African financial stakeholders to mobilise finance towards securing global net zero, consider and manage climate related risks.