Climate change is one of the defining challenges of our times and represents one of the most complex issues that the international community has ever faced. The physical impacts of climate change are already having profound and often devastating effects on societies around the world by adding significant stress to food production, water supplies, health services, and economic growth. Climate change will create numerous problems for developing countries and vulnerable communities in particular, as it will disproportionately affect the communities that contributed least to the problem, threatening to erase years of significant development gains made in these countries. Our Member Countries are no less susceptible to these diverse challenges.
With 47 Member Countries spread throughout the OIC region, and with the geographical coverage of our Member Countries spanning from South America to Asia and from Eurasia to Sub-Saharan Africa, our Member Countries are located in some of the world’s most climate vulnerable regions. ICIEC is committed to assisting each Member Country in their development goals, and an important part of this assistance is to help mitigate and adapt to the threats that climate change poses for its Member Countries. ICIEC understands that failing to mitigate and adapt to the effects of a warming planet and increasingly extreme weather patterns could undermine gains made to alleviate poverty, improve health, promote education, and boost prosperity across the Member Countries.
Stabilizing warming to 2 degrees Celsius or less is critical and will require both significant policy support and financial investments. ICIEC is in a unique position to help close the financing gap for climate-related projects and investments in its Member Countries, especially considering that many of the Member Countries might struggle to attract capital for such investments on their own. ICIEC has proven it has the capacity to de-risk and crowd-in additional investment for climate-resilient projects, and it is working consistently to improve its capacity as a climate finance provider. The Corporation has increasingly provided support for projects that strengthen its Member Countries against the threat of global warming, helping them both prepare for and adapt to the many challenges of a warming planet, and reduce vulnerability and the costs resulting from the impacts of climate change.
Notable ICIEC Climate Projects and Investments
While ICIEC still provides insurance for fossil fuel transactions due to the centrality of fossil fuels to its Member Countries’ economies, the Corporation also plays a catalytic role in facilitating renewable energy projects. ICIEC provides support for strategic investments in renewable energy, assisting with the import of technologies and their use in national infrastructure projects, like the creation of solar energy systems and wind farms. Some of the high-profile renewable energy projects that ICIEC has supported in the past include the world’s largest solar parks in Egypt, wind-power projects in Turkey, and coast protection works in Benin to protect the country from the effects of sea-level rise.
More recently in Q3 of 2020, ICIEC provided insurance cover for the construction of a new energy-efficient football stadium in the Republic of Senegal. This EUR 143,480,177 infrastructure project includes the construction of a 50,000 seat capacity football stadium and two training grounds with a system to produce and store solar energy to cover all the energy requirements. The development of this project will bring many economic benefits to the local and regional communities while still taking into consideration the climate change risks and opportunities at every step. This project is an example of how ICIEC can leverage its products to effectively crowd-in private sector capital for climate-related projects, and it represents a critical step towards Member Countries becoming more climate-resilient and energy-efficient.
Q3 results show that ICIEC has contributed over USD 418 million toward infrastructure and over USD 3.9 billion toward energy support this year alone, demonstrating the enormous capacity and potential that ICIEC has for becoming a leader in financing ‘green’ projects and infrastructure for decades to come. ICIEC understands that without capital being directed towards climate resilience, the projected perils of climate change will become a grim reality, not only for ICIEC’s Member Countries but for the world at large.
Looking Ahead
It appears difficult to remain focused on the challenges of climate change as the world still grapples with its response to the COVID-19 pandemic, but we cannot lose sight of our climate goals, even during these uncertain and unprecedented times. ICIEC will continue to offer strong leadership in climate finance and remain a reliable partner by turning uncertainties into manageable risks. In this complex and challenging environment, each country forges a path towards sustainable development specific to its context, but building climate-resilience must be a part of every country’s path forward. As we look ahead, especially in light of the current global pandemic, we must turn our attention to how we can build back better to create climate-resilient sustainable development for our Member Countries. There is great potential to be realized in how the OIC countries respond to climate change, which if harnessed properly will lead to economic and social prosperity for the people living within our OIC Member Countries. ICIEC will continue to work towards achieving this potential.
