A NEXUS APPROACH TO CLIMATE CHANGE & THE SDGs
|The water-energy-food nexus presents special challenges and opportunities for financial sector stakeholders in the Arab region, given the large inequalities in access to resources, the scarcity of water and – in many parts of the region – arable land.||
The interconnected nature of these three factors reflects an opportunity for financial sector leaders to engage in more sustainable planning in the way natural resources are used and how SDG-aligned projects and companies are financed.
Water is used throughout the regional agri-food chain, from agricultural production to fishing and forestry. In parallel, the agri-food chain consumes about 30% of total energy globally, as energy is required to produce, transport and distribute food and to extract, pump, collect and distribute water.
The same factors driving energy demand in the Arab region will also increase demand for water and food, as populations grow, living standards rise, mobility increases, and societies move towards more sophisticated technologies.
Investors and the financial sector stakeholders discussed above all have an opportunity to finance positive change at the nexus of food, water, and resource efficiency.
CLIMATE CHANGE IN THE ARAB REGION
Climate change has emerged as one of the most important factors exacerbating poverty and human insecurity in the Arab region. Managing climate risk is key to maintaining regional financial and political stability.
This stability is required for finance to flow into the investments and infrastructure required to achieve the SDGs. As part of the process of enhancing regional stability, climate finance must be scaled up in a way that boosts local prosperity and achieves tangible impacts across the SDGs.
Additional climate finance can support pre-existing public finance by mobilizing private finance, international financial institutions, impact investors, Islamic finance, philanthropists, crowd-funding, and other forms of innovative finance in a coordinated manner.
2030 AGENDA FOR SUSTAINABLE DEVELOPMENT
The 2030 Agenda for Sustainable Development and the SDGs mark a turning point in development policy globally and in the region. By achieving the SDGs in the Arab region, an era of climate disruption will be possible if countries and communities are able to anticipate, shape and adapt to this new driver of change.
|Climate change is inextricably linked to all the SDGs:||In taking action on SDG7 (access to clean energy) and 13 (resilience to natural hazards and disasters), Arab countries and their global peers can also support success on:
|Expanding finance for the energy transition in the Arab Region:||
|The nexus of climate change and displacement:||
|Food & Water Security:||
THE ARAB REGION’S LEADERSHIP OPPORTUNITY
Climate change has emerged as one of the most complex and important factors exacerbating poverty and human insecurity in the Arab region. Climate change amplifies existing challenges of water insecurity, falling agricultural productivity, fragile land and ecosystem services. As a result, climate change is generating social vulnerability, exacerbating existing internal and international conflicts and adding to the region’s refugee and human displacement crisis.
Most of the conflict-affected contexts in the Arab region are also some of the world’s top climate risk hotspots. This means that the adoption of more climate-resilient development models is key to both crisis prevention and recovery. The Arab region contributes around 5% of global emissions. However, the impact of climate change on the fragile environment of the region and its people is expected to be immense, which demands urgent planning for adaptation measures.
A DIVERSE REGION READY TO ADAPT TO THE FUTURE
The region is large and diverse with abundant natural resource wealth alongside climate vulnerability.
It includes 22 countries, stretching from Morocco and Mauritania on the Atlantic coast of North Africa, across Egypt, the Syrian Arab Republic, Jordan and Palestine in the Levant, or Mashreq, to Iraq, the Gulf Cooperation Council (GCC) economies and Yemen on the Arabian Peninsula.
It represents 10% of the world’s land area and is home to around 350 million people. In 2014, the region accounted for some 5% of the world’s total primary energy supply, though less than 5% of the world’s carbon dioxide (CO2) emissions and some 5% of the world’s GDP. The region’s financial wealth is heavily concentrated in the GCC and to a lesser extent the Levant and North Africa.
REGIONAL PERSPECTIVES ON RESOURCE EFFICIENCY
Traditional natural resources, including fossil fuels, are unevenly distributed in the Arab region. Countries including Iraq, Kuwait, Saudi Arabia and the United Arab Emirates (UAE) are large oil producers with sufficient reserves of oil and gas to continue production at current rates far into the future. These countries’ primary interest has historically been in the stability of global demand and pricing for their fossil fuels. Neighboring Oman and Qatar also have large natural gas reserves, and smaller oil reserves, with Qatar being the world’s second-largest exporter of gas.
Libya is a globally significant fossil fuel producer, although almost a decade of civil war continues to dent output. Smaller fossil fuel exporters including Algeria, Egypt, the Syrian Arab Republic and Yemen are more focused on short-term profit maximization and the diversification of their economies in the medium term away from oil and gas. Jordan, Morocco, Palestine and Tunisia are net importers of energy and have been most directly affected by rising energy prices on international commodity markets during the 2000s. As a result, these countries have embraced the clean energy transition and serve as a model to their peers who continue to rely heavily on fossil fuels in their respective national energy systems.