Today's Edition
ISIDORA CIRIC (DUBAI)
In a world grappling with the escalating impacts of climate change, the Middle East and North Africa (MENA) region stands at a critical juncture. Confronted with unique environmental challenges, from severe water scarcity to increasing temperatures, this region’s response to climate change is not just a local concern but a matter of global significance.
In an interview with Aletihad, Meskerem Brhane, World Bank’s Regional Director for Sustainable Development in the MENA region, offered insight into how the organisation is tackling the climate intricacies and emphasised the World Bank’s significant commitment to climate financing in the region. “Over a four-year period, our goal is to fund $10 billion for climate financing, and we’re very much on track, having already provided $6 billion,” Brhane stated, adding that the World Bank is on track of surpassing the $10 billion mark by 2025.
This commitment is critical, especially considering that the MENA region is one of the most water-stressed in the world, with about 17 countries below the water poverty line, according to the World Resources Institute. Discussing the specific climate challenges in MENA and GCC regions, Brhane highlighted several key issues.
“The region is facing rising heat levels, droughts, floods, rising sea levels, and coastal erosion, all of which significantly impact the economy and people’s livelihoods,” Brhane explained.
These challenges are particularly severe in a region where, according to the UNFCCC’s website, the entire MENA region is a climate change hotspot, with climate models predicting temperatures 20% higher than global averages. It is already the most water-scarce region in the world – and the increasing temperatures are predicted to lead to more persistent and acute drought, impacting agricultural productivity.
Water Scarcity
Addressing water scarcity, a critical issue in the region, Brhane noted that “six out of ten people in MENA are facing water scarcity and don’t have proper access to water.”
This issue is alarming, given that the MENA region, as per the World Bank, has less than 2% of the world’s renewable water supply but houses 6% of the world’s population. Water scarcity could also lead to GDP losses of up to 6.6% by 2050, she added.
Food Insecurity
Brhane also brought attention to increasing food insecurity in the MENA region. In developing MENA economies, this year alone, close to 9 million children are food insecure. Building resilient agriculture and food systems that can withstand climate and other shocks is a priority, she said.
Climate change will worsen displacement in a region already afflicted by conflict and violence. In North Africa alone, around 20 million people could become internal climate migrants due to water scarcity, poor crops, and from areas affected by rising seas, she noted. In 2020, 98% of MENA’s energy production came from fossil fuels, with subsidies accounting for 16% of GDP compared to 6.8% globally.
Repurposing subsidies will help diversify economies, reduce energy dependence, and open fiscal space, she added.
Water-Energy-Food Nexus
Moving to the water-energy-food nexus in MENA, Brhane said that agriculture plays a crucial role in the national economy, contributing to GDP and employment, as well as ensuring food security. “In countries like Tunisia, agriculture accounts for over 75% of total water usage.
Due to water scarcity in the region, agriculture relies on energy intensive water supply systems that rely on fossil fuels. So we need to look at food, energy and water in an integrated way,” she said. Using treated wastewater in agriculture, improving water-use efficiency through modern irrigation methods and working with farmers to cultivate crops that require less water are vital steps to address water scarcity.
“In MENA, 98% of energy production in 2020 was by fossil fuels and subsidies account for the equivalent 16% of GDP vs 6.8% globally. Repurposing subsidies will help economies to diversify, reduce energy dependence, and open fiscal space,” she said. Additionally, the shift to greener energy could create millions of jobs. In Egypt alone, meeting renewable energy targets could generate 2 million new direct and indirect jobs in the next three decades, according to the World Bank official.
UAE Leading Climate Action
Discussing the UAE’s role as a convener in addressing climate challenges, Brhane stressed that the UAE is a very important part of the climate agenda. “The UAE, as a host of various events, brings together different countries and sectors, making it an important convener on the climate agenda,” Brhane said.
“By hosting this event the UAE signals its leadership in climate action, its ability to work with other countries to tackle global issues and its own ambition in this space,” she added.
The UAE’s significant progress in desalination is highlighted, she added, noting that it could serve as a valuable platform for knowledge exchange among various countries. GCC countries can lead the global dialogue on energy transition and renewable energy deployment, by further aligning their growth pathways with global climate action and decarbonisation trends, according to the official.
She further stated that by embracing green growth strategies, the region’s GDP could potentially grow to over $13 trillion by 2050, compared to $6 trillion under business as usual scenarios. Of equal importance is private sector investment, which is crucial for the success of climate initiatives in GCC countries, she stressed, highlighting that significant investments will be needed to transform resource consumption, energy production, manufacturing processes, and other economic systems to achieve climate objectives.
She stated that the UAE estimates a need for $36 billion in investment between 2023 and 2030 to achieve its climate goals. Private sector investments can drive the low-carbon transition and attract green investments.
Economic Impact of Water Scarcity
Elaborating on projected GDP losses in the MENA region due to water scarcity, the World Bank official noted that depending on which global climate change scenario materialises, by mid-century, MENA countries could experience a significant decline in their annual real GDP due to climate change. Depending on the scenario, the GDP could be 1.1% to 6.6% lower than it would be without climate damage.
“This economic loss will be caused by various factors like heat, water loss, flooding, and crop yields that differ from one country to another, but water scarcity is the main driver. For example, in Tunisia, it is projected that 71% of real GDP losses by 2050 will be a result of water scarcity. While these estimates may not capture all climate impacts, it is evident that climate change will have a substantial impact on GDP and affect various economic sectors,” she said. Country Climate Development Brhane shed light on the World Bank’s Country Climate Development (CCD) reports and their impact on the region.
“These reports identify key risks and development challenges posed by climate change, providing concrete actions for countries to adapt and become more resilient,” Brhane stated. This guidance is essential in the MENA region, where, as per the World Bank, climate change could reduce GDPs by up to 14% by 2050 if unaddressed. Key recommendations from the recent CCD report for the MENA region were also discussed.
“The focus is on water, agriculture, and energy as an integrated whole, utilising technology for efficient irrigation and treating wastewater as an asset,” Brhane emphasised.
This approach aligns with the World Bank’s findings on the need for improved water and energy efficiency in the region.
World Bank’s Support for MENA
Brhane summarised the World Bank’s multifaceted support for MENA countries in climate change mitigation. “We provide diagnostics, reliable data, policy advice, and direct financing for impactful investments in the climate agenda,”
Brhane said, highlighting the comprehensive approach the World Bank takes when helping countries address the impacts of climate change.
The Bank’s climate efforts in MENA support transformations in key areas, including building resilience in the face of future climate shocks, she said, adding that MENA’s agriculture is 75% rainfed and temperature or rainfall changes due to climate change will worsen food security.
Elaborating further on the Bank’s efforts, she noted that in Morocco, 200,000 agri-food producers and entrepreneurs are being given financial incentives to switch to climate-smart agriculture practices. Also in Morocco, the Bank is supporting NDC implementation and efforts to mainstream climate policies across the government.
Morocco is also using nature-based solutions to adapt to and mitigate climate change, aiming to restore 26,6000 hectares of vulnerable ecosystems, including oases.
“In Jordan, our efforts to build more resilient food systems are boosting competitiveness and inclusion, potentially generating 12,000 new jobs for women and youth,” Brhane said.
In Tunisia, a disaster and climate risk project is helping to protect Tunisians against future climate events such as floods. The project is investing in urban infrastructure that will reduce flood risk while strengthening public financial protection for 1 million eligible Tunisians so that when disasters strike people can bounce back more quickly, according to the World Bank official.
As for Egypt, an air pollution programme in Cairo is expected to reduce emissions from public transport by 23% over the period of the project. She mentioned that in Iraq, capturing wasted flared gas could save around $2.5 billion per year. In 2021, IFC invested in Basrah Gas Company to develop a plant to process gas that would otherwise be flared, preventing around 10 million tonnes of GHG emissions per year.
The Bank is also leveraging regional connectivity for renewable energy generation. The landmark Tunisia-Italy interconnector project positions Tunisia as a regional hub for renewable energy by connecting Tunisia’s power grid to the much larger European network through a 600-megawatt undersea cable.
