Cop28 President Dr Sultan Al Jaber hugs UNFCCC executive secretary Simon Stiell after a plenary meeting on Wednesday in Dubai. Reuters
Cop28 President Dr Sultan Al Jaber hugs UNFCCC executive secretary Simon Stiell after a plenary meeting on Wednesday in Dubai. Reuters
Cop28 President Dr Sultan Al Jaber hugs UNFCCC executive secretary Simon Stiell after a plenary meeting on Wednesday in Dubai. Reuters
Cop28 President Dr Sultan Al Jaber hugs UNFCCC executive secretary Simon Stiell after a plenary meeting on Wednesday in Dubai. Reuters

Cop28's dealmakers leave Dubai with two years of homework


Tim Stickings
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A day after the UN climate roadshow left Dubai, several of Cop28’s weary delegates were in London, swapping tales, raising glasses and holding – if not quite a celebration – at least an upbeat reflection on the UAE-led summit.

At an eighth-floor reception 7,000km from Dubai’s Expo City, an Azerbaijani diplomat was already telling guests about his country’s vision for Cop29. Chris Skidmore, a climate champion in Britain's not-so-enthusiastic ruling party, was signing books on net zero. Even Stanley Johnson, environmentalist father of Boris, was handing out business cards.

Also significant was the star guest. Ed Miliband is currently the Labour opposition’s climate spokesman, but if polls for an expected UK election in 2024 are right, he could soon be the man turning the pledges of Cop28 into action.

The 194 countries who backed a deal in Dubai now have two years to draw up a new, more ambitious national climate plan, using the text known as the UAE Consensus as their guide. Their homework is due before Cop30 in Brazil in 2025.

“We often talk about this being the decisive decade when it comes to the fight against the climate crisis,” Mr Miliband said. “I think we’re entering the two years that are the decisive years of the decisive decade.

“The question for the world at Cop29 and Cop30 is – can we turn the words on the page … into action?”

The deal in the final moments of Cop28 was the first time the world has agreed to move away from fossil fuels. Pawan Singh / The National
The deal in the final moments of Cop28 was the first time the world has agreed to move away from fossil fuels. Pawan Singh / The National

Energy tasks

Many have described those words on the page as historic. More than 30 years after the world first set itself the goal of avoiding “dangerous interference” with the Earth’s climate, the UAE summit spelt out for the first time that this will involve “transitioning away from fossil fuels”.

The language was a compromise that emerged from all-night talks in Dubai. Some wanted a fossil fuel “phase out”. Another option was to agree nothing at all. The final text was a middle ground with a bit of something for everyone.

For poorer countries reluctant to take on new burdens, there are caveats that keep coal, gas, and fossil fuel subsidies on the table in some circumstances and an assurance that “different national circumstances” will be respected.

For those eager to ditch fossil fuels, there is hope that the Dubai deal's symbolic power is greater than the sum of its words and will generate an unstoppable momentum towards clean energy.

“We believe this is the start of the phase of the phase-out, if you allow the pun,” said EU climate diplomat Emilien Gasc.

“In the coming years, it’s absolutely key that everyone not only looks at the text but also at the spirit of the UAE Consensus and does their homework for the next round of nationally determined contributions.”

The Dubai text's call for a transition from fossil fuels is a compromise between demands for a phase-out and reluctance to take on economic burdens. AFP
The Dubai text's call for a transition from fossil fuels is a compromise between demands for a phase-out and reluctance to take on economic burdens. AFP

That homework includes trebling renewable energy capacity, doubling the rate of energy efficiency improvements, tackling methane emissions and developing clean technologies such as hydrogen and carbon capture.

There are also side pledges to act upon that were not part of Dubai’s agreed-by-everyone final text, such as an initiative by more than 100 countries to cut emissions from farming.

As Cop28 President Dr Sultan Al Jaber said in his closing remarks: “An agreement is only as good as its implementation.”

Some of this has begun already. Before the 48 hours were up between Cop28’s closing plenary session and Expo City’s reopening as a winter wonderland, Britain announced it had chosen 11 sites to produce green hydrogen.

French President Emmanuel Macron announced on Thursday that low-earning motorists will be able to lease electric cars for just €100 ($110) a month from January in a push to make more of them in Europe.

Scientists say emissions must start to plunge before 2030 if the world is to slow the global temperature rise to 1.5°C, staving off the worst effects on the planet. There is no time to lose, then, to turn pledges into reality.

Finance Cop looms

Dubai's pledges will cost money. The final text says developing countries will need as much as $5.9 trillion before 2030 to implement their go-green plans.

Everyone The National has spoken to, including the Azerbaijani ambassador, believes finance will be the key focus of Cop29 next November.

The entire global economy is really fundamentally redefining itself
Heather Buchanan,
Bankers for Net Zero

One key task passed on from Cop28 to Cop29 is deciding on a new funding goal to replace a 2009 promise of $100 billion a year for developing countries – which has arrived years late, if at all.

Also pencilled in for Azerbaijan are further talks on adaptation finance, meaning money that is not for cutting emissions but for facing up to climate change that may no longer be stopped.

This includes things such as flood defences that scientists say will become ever more necessary with every 0.1°C that the planet keeps warming.

Bangladesh has a funding gap of $5.5 billion a year as it faces rising sea levels that could devastate its low-lying coastline, said its high commissioner in London, Saida Muna Tasneem.

With the private sector asked to contribute, it has become a truism to say “the money is there” if only it can be allocated to green policies, but this is easier said than done.

Vulnerable countries such as Bangladesh need money to become more resilient to the effects of climate change. Bloomberg
Vulnerable countries such as Bangladesh need money to become more resilient to the effects of climate change. Bloomberg

“Fundamentally we’re starting from a financial system that’s evolved over hundreds of years,” said Heather Buchanan of Bankers for Net Zero. “At no point have we had nature and loss and adaptation sitting on your balance sheet.

“We’re now having to understand that. The entire global economy is really fundamentally redefining itself.”

As well as finance, the Dubai text describes technology transfer – sharing clean tech such as electric cars and drought-resistant crops with vulnerable countries – as a “critical enabler” of climate action.

“We cannot afford technologies,” said Ms Tasneem, who also expressed disappointment that less than $800 million has been pledged by rich countries to the loss and damage fund agreed at Cop28.

“Bangladesh is a densely populated country, every single acre has to be arable for agriculture. We need to ensure our food security. So where do we go? We go offshore. Offshore technologies are very expensive and we don’t have the means.”

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

UAE currency: the story behind the money in your pockets
The%20specs
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Cinco in numbers

Dh3.7 million

The estimated cost of Victoria Swarovski’s gem-encrusted Michael Cinco wedding gown

46

The number, in kilograms, that Swarovski’s wedding gown weighed.

1,000

The hours it took to create Cinco’s vermillion petal gown, as seen in his atelier [note, is the one he’s playing with in the corner of a room]

50

How many looks Cinco has created in a new collection to celebrate Ballet Philippines’ 50th birthday

3,000

The hours needed to create the butterfly gown worn by Aishwarya Rai to the 2018 Cannes Film Festival.

1.1 million

The number of followers that Michael Cinco’s Instagram account has garnered.

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%3Cp%3E%3Cstrong%3ECreator%3A%3C%2Fstrong%3E%20Ramez%20Galal%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%3C%2Fstrong%3E%20Ramez%20Galal%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStreaming%20on%3A%20%3C%2Fstrong%3EMBC%20Shahid%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E2.5%2F5%3C%2Fp%3E%0A
Updated: December 17, 2023, 9:28 PM`