{"id":623803,"date":"2024-06-11T00:00:00","date_gmt":"2024-06-11T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/goinggreens\/mideast-funding-towards-climate-tech-tripled-to-usd-5-bn-last-year-but-less-than-2-went-to-entrepreneurs-in-egypt-and-the-region\/"},"modified":"2024-06-11T00:00:00","modified_gmt":"2024-06-11T00:00:00","slug":"mideast-funding-towards-climate-tech-tripled-to-usd-5-bn-last-year-but-less-than-2-went-to-entrepreneurs-in-egypt-and-the-region","status":"publish","type":"goinggreen","link":"https:\/\/enterpriseam.com\/egypt\/goinggreens\/mideast-funding-towards-climate-tech-tripled-to-usd-5-bn-last-year-but-less-than-2-went-to-entrepreneurs-in-egypt-and-the-region\/","title":{"rendered":"MidEast funding towards climate tech tripled to USD 5 bn last year, but less than 2% went to entrepreneurs in Egypt and the region"},"content":{"rendered":"

MidEast funding in climate tech is heating up despite a global slowdown:<\/strong> Middle East players invested a total of USD 5 bn in climate tech around the world in the 12-month period ending September 2023, nearly triple the USD 1.8 bn deployed a year earlier, according to PwC\u2019s 202<\/a>3 Middle East Climate Tech Report (pdf)<\/a>.<\/p>\n

Defying the trend: <\/strong>The upswing came amid a global slump<\/a> in climate tech funding, which dipped by about 43% y-o-y to around USD 65 bn in 2023 on the back of a shortage in primary funding sources and macroeconomic headwinds, according to the report. <\/p>\n

Yet, less than 2% of that spending has gone to local entrepreneurs:<\/strong> Middle East players funneled some USD 69 mn into climate tech in the region during the period \u2014 a paltry 1.4% of their total investments. Instead, 70% of the funds went to innovators in North America, followed by China (14.8%), Asia Pacific (9.8%), and Europe (4%).<\/p>\n

Why?<\/strong> Middle East investors are reluctant to include regional entrepreneurs \u2014 which the report describes as the \u201cmissing link\u201d in their investment strategy \u2014 due to a focus on traditional performance metrics and a preference for large-scale national projects. Measures such as ROI, for instance, are difficult to forecast for new technologies. Additionally, prestigious government projects eclipse the capabilities of smaller firms.<\/p>\n

Investors around the globe are channeling less into the Middle East, too:<\/strong> Total funding for climate tech innovators based in the Middle East dropped 84.8% y-o-y to USD 152 mn during the period.<\/p>\n

WHERE DOES EGYPT STAND? <\/p>\n

Egypt is the third largest recipient of funding in the region: <\/strong>Local companies received some USD 210 mn in global climate tech funding between 2018 and September 2023 \u2014 11.4% of the total USD 1.9 bn funneled into the Middle East during that period. The lion\u2019s share went to the UAE (63.2%), followed by Saudi Arabia (24.9%). <\/p>\n

And ranks sixth in outbound investments: <\/strong>Egyptian investors deployed a combined c. USD 30 mn in climate tech globally in 2022 and 2023, coming in 6th at the regional level. KSA claimed the top spot with USD 3.9 bn of investments, followed by the UAE (USD 2.1 bn), Qatar, Kuwait, and Oman.<\/p>\n

We have a handful of climate tech innovators in the motherland: <\/strong>Homegrown startups Natrify<\/a> and TileGreen<\/a> in November were featured on PwC\u2019s first Net Zero Future50 Middle East report (pdf)<\/a> \u2014 a list of 50 startups in the Middle East implementing new technologies aimed at reducing emissions and addressing the impacts of global warming. Founded in 2020, Natrify produces biodegradable packaging and bioplastic products to help businesses go green. Meanwhile, TileGreen, which launched back in 2021, produces green paving tiles and sustainable building materials from plastic waste. The report also includes a number of local companies that are flagged as \u201cones to watch,\u201d including:<\/p>\n