Climate change in the Middle East and North Africa (MENA) represents a formidable and multifaceted challenge. This vast region grapples with environmental, economic, and social risks. These are driven not only by the mounting impacts of rising temperatures and extreme weather events but also by systemic factors rooted in its societies and economies. While these challenges loom large and require immediate attention, the call for action must be all-encompassing.
MENA’s climate leadership potential
The cornerstone of climate action in MENA rests on the collective commitment to the Paris Agreement. This is a pact endorsed by all nations in the region. However, the region’s current climate pledges are yet to meet the Paris Agreement’s objectives. MENA’s corporate landscape hasn’t advanced at the same rate as its global counterparts in terms of climate leadership.
Yet, amidst these challenges lies a promising opportunity. MENA is endowed with abundant solar and wind resources, which remain largely untapped. Embracing renewable energy sources and spearheading nascent sectors such as clean hydrogen could position MENA as a global heavyweight in clean energy exports. This approach accelerates MENA’s journey toward a decarbonized economy. In addition, it also addresses the surging worldwide demand for low-carbon solutions.
Further, the region, especially the GCC countries, has a confluence of three interlocking enablers. First is access to sovereign capital, which has a transgenerational view of risk and returns. Second is the existing physical and soft infrastructure to support global energy exports. Lastly is nimble and decisive leadership, enabling de-risking of large and complex first mover projects. Leveraging these, MENA could be at the forefront of the global energy transition.
Furthermore, sustainability aligns seamlessly with MENA’s broader goals of economic diversification and localization, acting as a catalyst for business expansion. Accelerating the transition to sustainability is the key to unlocking these opportunities and establishing the region as a frontrunner in the global clean energy economy.
Turning challenges into opportunities
Realizing this potential demands strategic efforts in the redirection of investments. It also entails the development of cutting-edge technologies, the cultivation of talent, and regional collaboration. Policymakers and regulators, playing a pivotal role in energy transition, could look to enact clear regulatory frameworks, provide financial incentives, and facilitate access to technology, infrastructure, and capability development to foster the growth of the nascent low-carbon technology sectors. Public and private sector partnerships can further expedite the progress. Businesses must play their part through innovation to scale these nascent pathways.
While it is true that climate action in MENA presents challenges and risks, it is also an avenue for nations and enterprises to capitalize on the transformations already underway. It offers an opportunity to diversify economies, generate high-quality employment opportunities, and take a lead role on the global stage in sustainable technologies. With a shared vision and prompt implementation, MENA can craft a just, resilient, and environmentally sustainable future that echoes the spirit and intent of international accords such as the Paris Agreement.
The time for action is now. Climate change knows no borders, and its impacts are felt by all. In MENA, we have a unique chance to champion a more sustainable and prosperous future for our region and the world. We can seize this opportunity, turning the challenges of climate change into a beacon of opportunity. MENA’s potential for sustainability is boundless, and it is our shared responsibility to unleash it.
Raja Atoui is a partner at Bain & Company while Dharmendra Hiranandani is a senior manager.
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