Sharm El-Sheikh -Mohamed Farid, Chairperson of the Financial Regulatory Authority (FRA), has said that the non-banking financial sector possesses enough capabilities to develop innovative financial mechanisms and products that support international efforts of the Egyptian government in stimulating green investments and climate finance.
This came during his participation in a session entitled “Mobilizing Climate Finance to Facilitate Green Transformation in Emerging Economies” in the Annual Meetings of the African Development Bank Group, which was held in Sharm El-Sheikh from 22 to 26 May.
Farid reviewed the efforts adopted and implemented by the Authority during the last period to develop frameworks based on several decisions and legislative amendments that allowed the availability of financing products and mechanisms compatible with the transition towards a green economy, including the amendments made to the executive regulations of the capital market law that allow the issuance of various types of bonds that support sustainable development activities.
He referred to the completion of the necessary work to activate the voluntary market for trading in carbon emission reduction certificates, which stimulates various economic entities to reduce their emissions of greenhouse gases by enabling them to issue certificates based on what is being reduced, and to sell and buy these certificates, so that they can benefit from that by offsetting the cost they incurred for the reduction, as well as achieving the biggest goal, which is to increase Egypt’s contribution to reducing the Earth’s temperature, the biggest international goal to work to reduce the occurrence of any natural disasters that may threaten businesses and human lives, to confirm that activating the voluntary market for trading carbon emission reduction certificates enhances green transformation efforts and climate action.
Farid added that stimulating climate action and green investments requires, in addition to financing, complete frameworks for developing and building capabilities and increasing the awareness and knowledge of business owners and various economic entities of the importance of this not only for the continuity and sustainability of their businesses, but also for the continuity of life in full.
In this regard, he referred to the decisions issued by the Financial Regulatory Authority Nos. 107 and 108, according to which non-bank financial companies are obligated for more transparency to disclose environmental, social and governance practices and to disclose the financial effects of climate change, in addition to organizing and hosting many events aimed at providing financial companies with the necessary knowledge and experience to properly understand how to prepare and present the necessary disclosure reports.
Meanwhile, Rania Al-Mashat, Minister of International Cooperation, reviewed the most important provisions of the “Sharm El-Sheikh Guide to Fair Financing”, which was launched within the framework of Egypt’s presidency of the COP27 climate conference, in light of Egyptian efforts to stimulate climate action and strengthen international efforts to mobilize fair climate financing for countries, pointing out that the guide works to translate pledges into feasible projects while exploiting existing opportunities to maximize the utilization of available international funds and work to increase them and stimulate the participation of the private sector to support the climate action agenda.
