KHALED AL KHAWALDEH (ABU DHABI)
Back in the 1980s, long before sustainability became a global priority, the UAE's Founding Father, the late Sheikh Zayed bin Sultan Al Nahyan spearheaded the planting of enormous quantities of trees around farms, cities and along the UAE's roads.
The idea was to combat desertification, reduce the spread of dust, protect soil and improve the general environment.
Today, the enduring legacy of this initiative is hard to miss, especially within the emirate of Abu Dhabi where an estimated 5 million trees have redefined the otherwise unforgiving desert topography.
Speaking to Aletihad, Head of ESG and Corporate Strategy at Mashreq, Faisal AlShimmari said that it was time that banks, increasingly invested in promoting "sustainable finance," took the responsibility of afforestation on themselves.
He believes that this could help create a thriving carbon market in the country, while continuing a legacy of beautification and restoration started by the UAE's Founding Father.
"Sustainable finance is becoming increasingly important in driving environmental initiatives. Banks have a unique position to support projects that contribute to ecological sustainability and biodiversity," AlShimmari told Aletihad.
"Afforestation projects are particularly impactful in this context, as they sequester carbon dioxide, consequently generating carbon credits that can be traded in the carbon market, thereby directly contributing to decarbonisation and combating desertification," he added.
According to the UAE's banking federation, UAE banks have issued more than Dh62.4 billion in green sukuks and bonds in recent years, with the sustainable financing market expected to grow substantially towards the end of the decade.
Much of the "green finance" that currently exists in the market is focused on energy and water projects, but AlShimmari wants to see banks and the industry take a more proactive role in supporting the financing of afforestation projects, creating marketable incentives for carbon sequestration and ecological restoration.
Currently, this move is being spearheaded by the UAE Carbon Alliance, a coalition of businesses dedicated to carbon market development which provides a framework for banks to support sustainability through carbon credits.
The alliance currently has plans to team up with AirCarbon Exchange (ACX) to create the "world's first fully regulated" carbon trading exchange and clearing house in Abu Dhabi.
For AlShimmari, the opportunity for regional banks to be part of this emerging market is one that should not be missed.
He said that public-private partnerships like the Ghars Al Emarat initiative, or mangrove planting programme in Abu Dhabi are perfect examples of the sort of projects that should be supported.
"Partnerships are essential for achieving large-scale environmental goals. For instance, Mashreq has joined forces with Emirates Nature-WWF to maximise the impact of environmental stewardship efforts, aiming to create the UAE's largest citizen science community for biodiversity mapping and preservation," AlShimmari said.
"These collaborative efforts between the banking sector, government agencies, and environmental organisations are crucial for the success of afforestation projects, as only collective action can lead to meaningful environmental changes."