KUWAIT: Reaffirming its dedication to fostering a sustainable, low-carbon economy and supporting Kuwait’s overarching sustainability vision alongside global climate change mitigation initiatives, National Bank of Kuwait (NBK) participated in the 29th United Nations Climate Change Conference (COP29), held in Baku, Azerbaijan, from November 11 to 22, 2024.
The conference brought together an esteemed gathering of global leaders, policymakers, private sector executives, academics, and civil society representatives. Discussions focused on critical challenges, particularly climate finance, emphasizing the urgent need to mobilize substantial financial resources. Participants stressed the importance of raising trillions of dollars annually to fund climate adaptation efforts and enable countries, particularly developing nations, to combat the impacts of climate change.
The discussions emphasized that advancing climate finance hinges on innovative financing mechanisms and substantial contributions from the private sector, through channels such as sustainable lending, green bonds, and green project financing. This aligns with NBK Group’s ESG strategy, which is built on four key pillars, with a core focus on facilitating the transition to a sustainable economy and fostering sustainable finance across the region.
NBK’s achievements in this space include issuing the first green bond by a Kuwaiti financial institution in the first half of 2024, valued at $500 million. The bank has also pioneered sustainable financing solutions, introducing green mortgage loans, sustainability-linked loans, consumer loans for electric vehicles, sustainable credit, and eco-friendly housing loans, among other offerings across its branches.
Finance day participation
As part of COP29’s "Finance Day” on November 14, NBK participated in the session titled "Financing the low-carbon energy transition in Asia and the Pacific”. Organized by United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), International Atomic Energy Agency (IAEA), International Renewable Energy Agency (IRENA), United Nations Environment Programme Finance Initiative (UNEPFI), and UN Trade and Development (UNCTAD), the session brought together public and private sector leaders to explore ways to close the climate investment gap and accelerate low-carbon energy adoption. The world faces an annual climate investment gap of $2.7 trillion by 2030. In the Middle East, $168 billion is needed annually by 2030 in climate mitigation measures to shift to a low-carbon economy.
Among the discussion, "Just Transition” emerged as a central theme for equitable and sustainable investments. As economies transition to a greener and lower carbon future, it is vital to ensure no one is left behind, emphasizing the importance of supporting developing nations, protecting jobs, and reducing social inequalities. As financial intermediaries, banks have a major role facilitating an equitable climate transition. Kuwait has made significant progress by contributing over $23 billion to assist developing countries in mitigating the impacts of climate change by investing in green energy and environmental protection projects.
Clean energy and green hydrogen
A key focus at COP29 was the urgent need to accelerate the adoption of clean energy technologies and scale up investments in this sector, particularly within emerging markets. NBK attended the Hydrogen Transition Summit organized by the Climate Action Organization, where discussions highlighted the role of low-emission hydrogen technologies in clean energy transitions.
The summit discussions emphasized the critical need for robust infrastructure development, solid off-take agreements, enhanced international collaboration, and addressing regulatory barriers to unlock green hydrogen’s potential. Experts pointed out that green hydrogen offers substantial opportunities to dramatically reduce carbon emissions across the GCC and MENA regions.
Green hydrogen has become a key point of discussion in Kuwait’s broader energy transition strategy. The country is developing a masterplan to build out 25GW of green hydrogen production capacity by 2050, which underscores its commitment to invest in clean energy.
Summit participants highlighted the critical role of public-private partnerships in closing the sustainable financing gap. Studies indicate a $380 billion investment gap in the hydrogen sector, highlighting the critical importance of sustainable financing to bridge this shortfall. By leveraging private capital, NBK firmly believes that these collaborations can fuel large-scale renewable energy projects, such as solar and wind farms, while also supporting the economic viability of green hydrogen technologies, especially in the GCC and MENA regions.
NBK’s unwavering commitment
NBK’s participation in this pivotal global event underscores its commitment to promoting unified action across both the public and private sectors to effectively combat climate change and advance global sustainability efforts. NBK has made significant strides in embedding Environmental, Social, and Governance (ESG) standards into its operations and core business activities, emphasizing that these principles are integral to the bank’s business strategy and corporate culture, including targeting a $10 billion sustainable asset portfolio by 2030 and a 25 percent reduction in operational emissions by 2025.
As part of its commitment to integrating ESG standards into its investment activities, NBK has reached notable milestones, including joining the United Nations Global Compact (UNGC), the world’s largest initiative for responsible business practices, and the Partnership for Financial Carbon Accounting (PCAF). Through these initiatives, NBK has become the first bank in Kuwait and one of only 13 banks in the MENA region to align with leading global financial institutions in measuring and assessing greenhouse gas (GHG) emissions linked to their lending and investment portfolios.