Good morning, ladies and gents. It’s a quieter morning on the regional climate industry front, but we have a basket of updates from the UAE and a rather strong warning from COP29’s incoming president ahead of the forum.

THE BIG CLIMATE STORY OUTSIDE THE REGION- There’s no single story dominating the headlines, but the Chinese climate envoy is set to visit Washington today. Xi Jinping’s Special Envoy for Climate Change Liu Zhenmin will join US top climate diplomat John Podesta in Washington today and tomorrow for a meeting of the bilateral Working Group on Enhancing Climate Action in the 2020s, according to a statement from the US Department of State. Discussions will revolve around topics outlined in the Sunnylands Statement, which include plans to cooperate on the energy transition, methane and other non-CO2 greenhouse gas production, the circular economy, and resource efficiency. The visit was first announced last week and is Liu’s first to the US following his ascension to the role.

What is the Sunnylands Statement? The Sunnylands Statement is a joint declaration issued by the US and China in 2023 to enhance cooperation as well as reaffirm and commit to furthering the implementation of previous joint statements addressing the climate crisis. It focused on the establishment of a working group to tackle climate-related issues. The story got ink in Reuters and Bloomberg.

COP WATCH-

Developing countries must demonstrate transparency in climate spending to justify requests for tns in aid, COP29’s incoming president Mukhtar Babayev said in an exclusive interview with The Guardian. Babayev called on developing countries to submit reports detailing their progress on efforts to curb emissions, and on how they have allocated their spending from their climate budget or funding they obtained. “It’s very important to build this correct, good and honest trust between the parties,” he added, to help create a transparency mechanism between countries giving out and receiving loans.

Another finance-focused COP: COP29 will prioritize unlocking funding as a means to address climate change. “Countries will be expected to come up with a new global goal on supplying climate finance to poorer countries,” the Guardian writes, adding that some governments from developing countries are calling for the sums to reach more than USD 1 tn a year. “Developing nations would need USD 2 tn annually [to fight global warming], with half of that coming from foreign sources,” Germany’s foreign affairs minister Annalena Baerbock said at the two-day Petersberg Climate Dialogue in Berlin in April.

WATCH THIS SPACE-

#1- A step forward for Jordan’s mega green hydrogen project: Jordan’s Energy and Mineral Resources Ministry has received the technical and economic studies for establishing a USD 1.6 bn green ammonia and hydrogen production plant in Aqaba, according to a statement. The study was conducted by Jordan Green Ammonia — a JV formed between Poland-based Hynfra and Jordan-based Fidelity Group in June for the purpose of establishing the project in the Aqaba Special Economic Zone.

We knew this was coming: Jordan Green Ammonia signed an MoU with the ministry to conduct a one-year preliminary feasibility study on developing green hydrogen projects back in October. Depending on the outcomes of the study, the ministry will enter into a framework agreement followed by a final agreement to kickstart the project’s development.

Details remain scant: Construction for the giant plant is set to take 3 to 4 years, the statement said. The project plans to integrate technology for producing green ammonia and hydrogen from desalinated seawater.

#2- The Iraqi Parliament will soon vote on a bill regulating the country’s renewables energy sector, member of the parliament’s Electricity and Energy Committee Kamal Anid Al-Kaabi told Iraqi news outlet Economy News in an interview. The parliament has completed its second review of the law and will proceed to voting on the new legislation “soon,” Al-Kaabi said. If passed, the law will help boost foreign investment into the sector as it will set regulations on “carbon investment, and solar energy generation.”

About the law: The new law aims to develop and improve Iraq’s renewable energy sector, enhance energy efficiency, and consider the establishment of a national emissions trading company linked to the Renewable Energy and Energy Efficiency Regulatory Authority. The committee reviewed contributions from advisory bodies, including various ministries and committees, and recommended expediting the legislation process according to the legal protocols of the Council of Representatives in March, emphasizing the urgency of its enactment.

#3- Indonesia is looking to secure UAE investments to spur its domestic green aluminum production, special advisor to the Investment Ministry Pradana Indraputra told Indonesian news outlet The Jakarta Globe on the sidelines of this week’s Dubai Chambers forum. Emirates Global Aluminum is among the companies exploring investing in the country, Pradana added. EGA previously partnered with Indonesia’s state-owned aluminum smelting company Inalum to use its technology to expand the latter’s Kuala Tanjung smelter capacity to 400k tons annually.

#4- BP investors anticipate climate target cuts: BP shareholders are expecting a cut back in the company’s targets as oil demand grows, unnamed investors told The Financial Times. “We’d all love them to build more in renewables but from a shareholder point of view, returns are not there,” the shareholders said. This follows the appointment of Murray Auchincloss as the oil giant’s CEO in January, whom investors believe will prioritize returns over the company’s previous climate pledges, similar to the U-turn that newly appointed British oil firm Shell CEO Wael Sawan has taken away from the green transition. While BP is the only major oil company that has committed to a reduction in production — targeting 2 mn barrels by 2030 — BP’s management is currently considering bumping production above the set target, according to a letter by investor Bluebell Capital Partners seen by the FT.

BP is not the only one to back down: Proxy advisory firm Glass Lewis advised British oil giant Shell shareholders to vote against a resolution proposed by investors calling for the energy company to set stricter climate targets last week. Shell also lowered its emission goals and dropped its goal of a 45% reduction by 2035.

But may be eyeing more low-carbon energy investments as prices dip: BP may be looking to invest in low-carbon energy projects in efforts to seize the chance of a relatively low valuation period in the sector, BP’s CEO Murray Auchincloss told investors, Bloomberg reports. BP is interested in acquiring projects in areas including biogas, biofuels and electrification, Auchincloss said, without providing further details. “Watch this space. We may do some more things,” the CEO stated, adding that investments in low-carbon energy are “looking more attractive at the moment.”

#5-Asian ESG funds down in 1Q: Green funds in Asian countries — excluding Japan and China — saw a 63% drop from the last quarter’s USD 1.7 bn in net new investment to USD 622 mn, The Financial Times reports, citing data from Morningstar’s Global Sustainable Fund Flows (pdf) report. Total sustainable fund assets in the continent excluding Japan — which together make up 2% of global sustainable funds — saw a 1.6% increase compared to the last quarter.

Taiwan carried the team: Most countries in Asia had small outflows, but Taiwan brought the region to net positive with over USD 1.2 bn in net new money. Taiwan is the largest market in the region after Japan and China with 24% of assets put into sustainable funds.

REMEMBER- ESG is taking a hit globally: 4Q 2023 saw ESG’s first ever quarterly outflows. US investment giant Blackrock is amongst the companies that have been feeling the heat, after the narrative around ESG investing has become riddled with lobbyists arguing that ESG policies negatively impact the fossil fuel industry to the detriment of the economy. ESG proponents however believe that ESG policies are not going far enough to address climate change.

#6- China’s solar manufacturing industry may be looking up: China’s leading solar panel manufacturers Jinko Solar and Trina Solar have signaled a potential end to the plummeting prices in the solar industry, Bloomberg reports. The current low prices are unlikely to fall further as the situation is “irrational,” the chairmen of both companies expressed in a joint presentation. Despite a challenging year with overproduction and shrinking profits, Jinko Solar anticipates a 20% rise in global panel demand, which may help rebalance the market. The company is also ramping up its production in the second quarter of this year.

REMEMBER- The industry has been struggling: China’s solar panel makers have been at risk of plummeting panel prices due to a major oversaturation in production capacity fueled by years of subsidies and have been merging to withstand falling panel prices.

OUR NEXT CONFERENCE IN CAIRO-

Foreign investors are falling in love with Egypt again… Foreign investors we speak with (debt, equity, and strategic alike) have growing appetite for Egypt. They’re buying into local debt, eyeing promising shares, and committing bns of USD to both new ventures here and the growth of their existing businesses. They like the Egypt story that’s taking shape after the float of the EGP, and its competitive advantages are clear to many of them: It’s a massive consumer opportunity and a regional export hub of tomorrow.

The Enterprise Optimism Forum 2024 will do exactly what it says on the tin: Spark conversations about a future that sees Saudi Arabia, Egypt, and the the UAE at the heart of a more vital Middle East economy — and provide an early, actionable roadmap for those who are “long Egypt.”

We’ll be talking with you about the agenda over the coming couple of weeks. It features speakers from Egypt and abroad who are future-proofing their businesses and angling to capture tomorrow’s opportunities — and who aren’t afraid to answer some tough questions.

*** Interested in attending? Tap or click here to let us know. Seating is limited.

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CIRCLE YOUR CALENDAR-

Saudi Arabia will host the Saudi Energy Convention from Sunday, 19 May to Tuesday, 21 May in Riyadh. The convention will see energy and utilities industry leaders advance collaborative decarbonization efforts and identify innovation areas. It will also host the Saudi Utilities Convention and Saudi Hydrogen Convention to address the role and challenges of rolling out hydrogen, water and utility projects that are in line with the global energy transition. Over 10k energy professionals and 200 industry speakers will be present at the event.

The UAE will host The Electric Vehicle Innovation Summit from Monday, 20 May to Wednesday, 22 May in Abu Dhabi. The event will see industry leaders come together to discuss sustainable mobility and tapping into groundbreaking advancements in electric vehicles while engaging with key decision-makers.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

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