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COP28: Global Expectations and Market Impacts

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On 30 November 2023 COP28 begins. The conference is set to spotlight climate finance and the outcomes have the potential to impact people around the world.

See also: – COP28: ‘Don’t come home without a deal’

From the role of private finance, the results of the global stocktake, development of green tech in Asia to natural capital implications for Africa, investors across the globe have shared their expectations for the conference the potential impact on the markets they operate in.

Read on for insights from regional experts


‘I would expect more support around areas of green technology’
Kathlyn Collins, Head of Responsible Investment and Stewardship, Matthews Asia

I would expect favourable policies out of Asia and more support around the areas of green tech. The current elevated oil prices are driving governments to push for energy independence by investing in renewables and/or nuclear technology. For significant progress in this area, we will have to see more announcements of strategies to overcome some of the technology gridlocks, such as energy storage and grid infrastructure, and this could present investment opportunities, similar to what we have seen in the wake of the Inflation Reduction Act in the US.

In addition, a lot of eyes will be on the fossil fuel companies at COP28 and the debate on the wording around the phase out or phase down of those fuels. I would also expect we see a few more announcements ahead of the event, similar to China publicly declaring an action plan dedicated to methane emission control earlier this month. The continued reliance of coal in China, India, Indonesia and Vietnam will likely come up as well. There is hope that the loss and damage fund will see more details emerge at this COP as well.


‘We’re hoping for clear directives for investors’
Leslie Samuelrich, President, Green Century Funds

I hope countries report real progress at COP28 on reducing their greenhouse gas emissions; however, the challenge is that countries, such as the US, are behind in its goal to halve emissions by 2030 and so we need to act more swiftly than we have.

By making climate finance a priority to address at COP28, international decision makers have already signalled that investments need to play a critical role. It’s crucial that the gathering not get weighed down by differences and instead focus on actionable solutions. It’s up to participants to deliver to meet this challenge.

There are more opportunities for private climate finance to unleash the needed capital than ever before and at least three bills in the US have unleashed capital aimed at developing regulations, technologies, and investment to transition to a low-carbon economy.

The Infrastructure Act provides funding to shore up transportation infrastructure and modernise the electric grid system. The Chips Act supports research and development of microchips that enable electrification of cars and will cut down on greenhouse gases used in plants, and of course, the Inflation Reduction Act, which has already stimulated expanded electric vehicle purchasing, pilot hydrogen energy centres and solar installations – with more to come. Do we need more investment? Of course. But we’re hoping that there will be clear directives for investors to prioritise climate finance.

Latin America

‘Outcomes of COP28 will drive the goals presented at COP30 in 2025’
Eduardo Figueiredo, Director, Head of Brazilian Equities, abrdn

In a joint effort to address climate challenges and drive the region towards impactful outcomes at COP28, representatives from 27 countries, including governments, civil society and private sector met at the end of October at the Latin America and the Caribbean Climate Week, where the region’s environment ministers agreed on a joint proposal to take to the UN Climate Change Conference that approaches six themes: climate change, biodiversity, pollution, gender, environmental education, consumption and sustainable production.

As Latin America presents several desirable characteristics when it comes to advancing renewable energy projects, with a fortunate positioning in terms of natural resources and energy matrix, this group also drafted a 51-point declaration in which they urge developed countries to create a set of mechanisms to support the region’s efforts on climate change through financing.

Brazil has an exceptional interest in the developments of COP28 due to the first global stocktake, where countries will evaluate their progress and shortcomings regarding the Paris Climate Change Agreement. The outcomes of the stocktake will drive the renewed and revised goals that countries will present at COP30, which will take place in Brazil in 2025, and the country will have an important role as the conference host to push for ambitious and robust goals.

Brazil itself, following the initiatives from Mexico and Colombia, has put forward a proposal for a Brazilian Sustainable Taxonomy, with a set of rules that will be presented at COP28. This taxonomy aims to define sustainable activities, transforming and guiding the economy towards a more sustainable and regenerative model. Chile, Peru and Dominican Republic are also in the process of developing their taxonomies.


‘Political opportunity to reset ambitions higher’
Louisiana Salge, Head of Sustainability, EQ Investors

COP28 will centre around the first global stocktake since the Paris Agreement. We hope this will give political opportunity to reset ambitions higher, rather than the opposite trend we have seen in 2023 so far.

The Emirati presidency this year is expected to focus away from fossil-fuel phasedown discussions to a holistic discussion across sectors. It is also expected to focus on carbon capture and offsets as viable solutions, while it is acknowledged that these should be reserved for tackling residual emissions in hard-to-abate sectors with little decarbonisation alternatives.

Regarding climate finance, the global stocktake puts pressure on overcoming the barriers to deploying flows to where they are needed. We think that talks will accelerate mechanisms to attract private capital to developing countries.

The UK government has rolled back the concrete methods to achieve its net-zero commitments. Looking at emerging markets, we must focus on making the green transition less of a trade-off versus exploring existing natural fossil fuel capitals. We remain hopeful this can be achieve.


‘We hope to see transition strategies made more explicit’
Matt Christensen, Global Head of Sustainable and Impact Investing, AllianzGI

Among potential highlights of the COP28, we hope to see transition strategies made more explicit. But the co-opting of the agenda by fossil fuel interests will generate further scepticism that the COP forum has become too closely aligned with the traditional economic interests of sovereigns and corporates.

Progress was made since COP27 and there were reasons to be optimistic. We are seeing significant technological advances in energy efficiency and climate solutions, the capital being allocated to sustainability is increasing, and targeted climate policies are shifting perceived wisdom.

We do not expect any major developments on the phasing out or down of fossil fuels, but pressure to redirect subsidies could be impactful for new carbon removal or storage technologies. Progress on methane emissions and renewable energies is also very likely.

COP28 will be the first conference meeting to explicitly discuss the link between climate change and global health trends. The topic of who and how climate is financed is an evergreen topic, but we expect discussions on transforming the climate finance system. Trade was voluntarily set aside from the Paris Agreement, but we expect it to be a major focus on the finance thematic day.


‘An opportunity to secure a sustainable future for our region and the planet’
Dorothy Maseke, Africa Lead, African Natural Capital Alliance

African investors have multifaceted expectations from COP28. First, they seek ambitious commitments and actionable plans from global leaders, given the stark impact of climate change and escalating nature loss.

Africa’s economic growth heavily relies on its natural capital, with up to 62% of its GDP dependent on nature. Preserving our natural resources is not just an environmental concern; it’s vital for our long-term economic and social wellbeing.

With reports that ecosystems and other natural solutions could contribute more than a third of the total climate mitigation needed by 2030, nature and nature financing will be central themes. It aims to demonstrate how businesses are innovating to meet nature-related goals through science-based targets, comprehensive reporting and integrating frameworks developed by initiatives such as the Taskforce on Nature-Related Financial Disclosures to address environmental risks.

African investors also face significant challenges in accessing private climate finance, despite our abundant natural capital and renewable energy potential. COP28 offers an opportunity for constructive dialogue with the international community to address these challenges and secure a sustainable future for our region and the planet.

Middle East

‘Reform multilateral development banks to unlock finance’
Luma Saqqaf, Founder, AJYAL Sustainability Consulting

UAE investors expect continued discussions over the involvement of private finance, as well as the need to reform multilateral development banks to unlock additional finance and take more investment risk. Ultimately, this could enable private financing of climate-positive projects.

In addition, the low-carbon economy will be a key topic. The low carbon economy presents huge new opportunities for the UAE in renewables, solar, hydrogen, capture technologies, and a range of other tools to achieve decarbonisation. Key stakeholders who could finance a low-carbon economy will be at the discussion table.

The MENA region, especially UAE and Saudi, is also focused on developing regional carbon markets. This will be a big talking point at COP28. The carbon market is seen as a ‘win-win’ by providing investments in Africa and the global south, while also creating an opportunity for corporates to buy credits to offset their emissions.

For the UAE, and indeed regional companies, understanding their carbon footprint and the necessary strategies to reduce this remains a challenge. Change is happening but not fast enough, thus limiting the ability to create trusted, investible projects.

However, investment is happening, and the UAE’s nationally determined contributions clearly indicate an alignment with the country’s plan to double the economy to aed3trn ($900bn) by 2031. For the UAE, investment in climate-related projects fulfils both economic and environmental goals, if carried out effectively.

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