Good morning, folks. We have a brisk issue this morning with an update on the first board meeting of the Loss and Damage fund currently underway in Abu Dhabi, and a smattering of updates from KSA. First, an update on UN plastics talks in the Great White North…

THE BIG CLIMATE STORY OUTSIDE THE REGION- The plastic treaty talks in Ottawa made progress, but there’s still more work to come ahead of a final treaty later this year. Delegates from 170 member states and over 480 observer organizations convened to refine the international legally binding draft text on plastic pollution, including marine environments. Despite objections from some parties, a group of 28 countries issued a pledge to include production caps in the final treaty text. Over 50 countries supported a proposal to assess the measures for what a sustainable level for plastic production would entail, and countries across the board also agreed to set forth a plan for how to identify hazardous plastic chemicals and wasteful plastic products including single-use plastic. Work will continue in ad hoc meetings before the final summit on 25 November in Busan, South Korea, including discussions on how developing countries can fund an implementation of any proposed treaty.

The story made headlines in the international press: Reuters | AP | Bloomberg | The Financial Times | Washington Post | The Guardian

COP WATCH-

The Loss and Damage Fund kicks off its first board meeting in Abu Dhabi: COP28 President Sultan Al Jaber opened the inaugural board meeting of the Loss and Damage Fund yesterday in a speech calling for urgent and efficient progress on the Fund's financing operations, Wam reports. Al Jaber stated that the initial USD 792 mn in funding arrangements pledged during COP28 “was a good start” but “is not enough.”

What’s on the agenda? The meetings will discuss setting up a committee to cover the additional rules of procedure for the Board, according to an X statement by the Loss and Damage Corporation (L&DC). The rules would also apply to civil organizations to allow them to contribute to the Board's intersessional work, the statement explains. The board meetings will also address a letter sent from civil organizations stressing that their participation in the board meetings is essential to ensure transparency and accountability, according to L&DC. The meeting is scheduled to conclude tomorrow.

World Bank might be the fund secretariat: The World Bank has until June 12 to decide on whether it’ll hold the secretariat for the fund, according to an X post. It also has until August 12 to submit the documents needed for the World Bank’s Financial Intermediary Fund.

More calls for increased financing: The fund still needs major financing and policies to regulate to better direct the funds, Fossil Fuel Non-Proliferation Treaty’s Engagement Director Harjeet Singh said on X. “Rich countries must provide hundreds of bns annually with the speed and scale necessary for the recovery and rebuilding of lives and livelihoods shattered by [the climate crises] in poorer nations,” he added.

And more representation: The Loss and Damage Fund Board must expand its engagement beyond UN representatives to include frontline communities directly impacted by climate disasters, UN’s Women and Gender Constituency’s Liane Schalatek said on X. “We urge the Board to ensure that the most affected communities, those in the most vulnerable situations, are not merely participants but leaders in this process at all levels. They have lived experience on how to address and repair climate-related harm,” Engo climate scientist Isatis Cintrón said on X.

WATCH THIS SPACE-

#1- DFC explores funding Egypt’s Gabal El Zeit wind farm: The US InternationalDevelopment Finance Corporation (DFC) is considering financing UK-based private equity giant Actis’s planned acquisition of the Gabal El Zeit wind station in Egypt’s Gulf of Suez, Al Borsa reported, citing DFC data. The data did not disclose further information, but revealed that the US firm is looking into providing financial insurance against “political risks,” the news outlet added. This comes only a few weeks after the European Bank for Reconstruction and Development said it is reviewing a proposed USD 140 mn loan for Actis to finance its acquisition of the 580 MW wind farm, which it plans to approve in June.

ICYMI- The acquisition is on the way: Actis reportedly wrapped up due diligence on the 580 MW Gabal El Zeit wind farm in February. The International Monetary Fund (IMF) predicts that Egypt’s sovereign fund will complete the sale of its Gabal El Zeit and Zafarana wind farms in the next couple of months.

#2- UAE-headquartered urea and ammonia exporter Fertiglobe is currently in the “evaluation and development phase” for several of its announced green projects, according to the company’s 2023 annual report (pdf). A final investment decision for Fertiglobe’s 100 MW electrolyser green hydrogen plant in Egypt is expected to be secured by July, pending the assessment of engineering and technology choices and the company is also awaiting the final investment decision on the Ta’ziz — a joint venture between Adnoc and ADQ — project to construct a facility to produce some 1 mn tons per annum of low carbon ammonia soon, after being delayed for more than 6 months. Low-carbon ammonia sales from its carbon capture venture with Adnoc is also expected to begin before the end of this quarter, the report adds.

#3- Four Arab bourses commit to reaching net zero by 2050: The Amman, Bahrain, Muscat, and Palestine stock exchanges have joined the Net Zero Financial Service Providers Alliance, pledging to support the goal of global net-zero greenhouse gas emissions by 2050 or sooner, according to a statement by the Arab Federation of Capital Markets (AFCM), of which the four exchanges are members of. The Alliance is part of the Glasgow Financial Alliance for Net Zero (GFANZ). The stock exchanges announced their commitment during the Annual Conference of the AFCM which was held in Doha, Qatar.

About AFCM: The AFCM was launched in early February as an initiative to encourage its members to join the United Nations Sustainable Stock Exchanges (UN SSE) initiative in signing the Net Zero Pledge and joining the Net Zero Exchange Group, according to the SSE website. AFCM includes 17 stock exchange members, the federation’s website writes.

#4- Producers of polysilicon — a key component in PV cell manufacturing — are expected to be the first to recover from the solar industry downturn, GCL Technology Holdings VP Amy Song told Bloomberg. The polysilicon sector has been facing a crisis of oversupply, “forcing many to sell near or below costs and prompting some manufacturers to cut output to avoid losses,” Bloomberg explains, adding that prices dropped to USD 6.76 per kg last week, compared to USD 39 in August 2022.

Why is polysilicon predicted to be the first to exit the rut? The polysilicon sector will be able to “shakeout” the impacts of the struggling solar industry due to its high capital costs for reentry, which can protect surviving companies from increased competition and allow for “quicker recovery,” Song explains. Other segments of the solar industry, like wafers, cells, and modules, may take longer to recover.

Recovery will still take time: It will take six months to a year until polysilicon prices rebound to rational levels at about CNY 60 per kg (USD 8.28 per kg), Song told Bloomberg. This will happen as supply in the market continues to fall on the back of manufacturers exiting the market, which Song believes will continue to happen in the next 3-6 months. Chinese solar companies have been struggling with dwindling margins amid fierce competition which have been impacting EU manufacturers even more.

REMEMBER- GCL is looking to diversify in the region in efforts to ride out the slump: GCL is looking to build its first international polysilicon factory in Saudi Arabia. The plant is expected to have a capacity of 120k tons a year, and operations could begin as early as 2025.

#5- A proposal for a tax on fossil fuel extraction in advanced economies could generate USD 720 bn by 2030 for the most vulnerable communities facing climate damage, according to a recent report (pdf) by environmental NGO Greenpeace. The organization’s Climate Damages Tax proposal is supported by over 100 climate organizations. According to the report, 80% of the funds collected from the proposed tax would go to the newly established Loss and Damage Fund, aiding developing countries in their climate crisis response through a just transition to renewables. The rest could be returned to communities where the tax is imposed as a “domestic dividend” to support them during the climate transition, the report suggests.

The breakdown: The report suggests introducing a tax to the 38-member OECD intergovernmental organization of advanced economies starting this year at a low initial rate of USD 5 per ton of CO2, and increasing it by USD 5 per ton each year. If introduced, the tax would raise a total of USD 900 bn by 2030 — USD 720 bn of which would go to the Loss and Damage Fund and USD 180 bn to the domestic dividend. The proposed tax would be integrated into existing royalty payment systems, ensuring ease of administration, Greenpeace explains. The tax would also help accelerate the phase-out of fossil fuels by making their production costlier.

#6- Another round of US-China talks is on the way: China intends to discuss expanding cooperation on energy, the circular economy, and decarbonization efforts with the US at an upcoming visit to the US in May, China's newly appointed climate chief Liu Zhenmin told Bloomberg. “Common ground means that both the US and China want to continue to lead this global process to respond to climate change,” he added.

ICYMI- The US and China are making progress: US Treasury Secretary Janet Yellen and Chinese Premier Li Qiang concluded a diplomatic visit in Guangzhou last month which left the US-China relationship “on more stable footing.” Trade issues were sparked by a Chinese oversupply of cheap solar panels and EVs which crowded American and European markets and threatened domestic production. Yellen had warned Beijing earlier against dumping key components of the global green economy on other markets, arguing the practice “distorts global prices and production patterns and hurts American firms and workers, as well as firms and workers around the world.”

DANGER ZONE-

Electronic waste generation is now outpacing recycling efforts by five times, according to a recent report (pdf) by the UN's fourth Global E-waste Monitor. A record 62 mn tons of e-waste — discarded and broken electrical and electronic devices — were produced in 2022, up 82% from 2010, and numbers are projected to reach 82 mn tons by 2030. Improving e-waste collection and recycling rates to 60% by 2030 could bring significant economic benefits, exceeding costs by over USD 38 bn, the report suggests.

Recycling efforts need to accelerate: Of the USD 62 bn worth of generated e-waste generated globally by 2022, only 22.3% of it was properly collected and recycled, posing major environmental and health risks as a result of the hazardous materials it contains. Challenges like technological progress and limited repair options contribute to the widening gap between e-waste generation and recycling efforts, the report explains.

OUR NEXT CONFERENCE IN CAIRO-

Foreign investors are falling in love with Egypt again… Foreign investors we speak with (debt, equity, and strategic alike) have growing appetite for Egypt. They’re buying into local debt, eyeing promising shares, and committing bns of USD to both new ventures here and the growth of their existing businesses. They like the Egypt story that’s taking shape after the float of the EGP, and its competitive advantages are clear to many of them: It’s a massive consumer opportunity and a regional export hub of tomorrow.

The Enterprise Optimism Forum 2024 will do exactly what it says on the tin: Spark conversations about a future that sees Saudi Arabia, Egypt, and the the UAE at the heart of a more vital Middle East economy — and provide an early, actionable roadmap for those who are “long Egypt.”

We’ll be talking with you about the agenda over the coming couple of weeks. It features speakers from Egypt and abroad who are future-proofing their businesses and angling to capture tomorrow’s opportunities — and who aren’t afraid to answer some tough questions.

*** Interested in attending? Tap or click here to let us know. Seating is limited.

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CIRCLE YOUR CALENDAR-

Algeria will host the Global Waste Forum from Tuesday, 7 May to Thursday, 9 May in Algiers. The forum will focus on the latest waste management technologies and bring together industry leaders to explore cooperation on circular economy strategies, renewable energies, and digitization.

Saudi Arabia will host the Saudi Energy Convention from Sunday, 19 May to Tuesday, 21 May in Riyadh. The convention will see energy and utilities industry leaders advance collaborative decarbonization efforts and identify innovation areas. It will also host the Saudi Utilities Convention and Saudi Hydrogen Convention to address the role and challenges of rolling out hydrogen, water and utility projects that are inline with the global energy transition. Over 10k energy professionals and 200 industry speakers will be present at the event.

The UAE will host The Electric Vehicle Innovation Summit from Monday, 20 May to Wednesday, 22 May in Abu Dhabi. The event will see industry leaders come together to discuss sustainable mobility and tapping into groundbreaking advancements in electric vehicles while engaging with key decision-makers.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.