Abu Dhabi' s renewable energy firm Masdar has signed an agreement with the World Bank Group’s private-sector arm, the International Finance Corporation (IFC), to explore areas of collaboration to support climate action in emerging markets.

The deal was signed by Mohamed Jameel Al Ramahi, Chief Executive Officer, Masdar and Mohamed Gouled, Vice President of Industries at IFC, on the side-lines of the World Government Summit 2023 in Dubai.

Dr Sultan Al Jaber, UAE Minister of Industry and Advanced Technology, COP28 President-Designate, said: “As the UAE prepares to host COP28, we have placed a special emphasis on ensuring better, more efficient and more equitable access to climate finance.”

"The International Finance Corporation has been a key partner for Masdar in a number of emerging markets, and this agreement carries forward the UAE’s commitment to equitable climate finance and inclusive sustainable development,” he added.

Makhtar Diop, Managing Director of IFC, said: “Under the agreement, Masdar and the IFC will explore support for the establishment of green hydrogen platform for emerging markets, and potential collaboration on bankability and structuring issues for African renewable energy projects."

The agreement also covers exploring mechanisms to accelerate the adoption of distributed photovoltaic (DPV) systems, and the development of innovative new technologies and business models in emerging markets in response to the evolving climate crisis. 

Masdar has already completed many projects in African countries, including Egypt, Mauritania, Seychelles, and Morocco.

Last month, Masdar signed deals for projects with a combined generation capacity of 5 GW across Angola, Uganda, and Zambia as part of Etihad 7, a UAE-led initiative that aims to raise public- and private-sector funds to invest in the development of Africa’s renewable energy sector.

The IFC uses its capital, expertise, and influence to create markets and opportunities in developing countries.

Diop called on world leaders and heads of government to cooperate in making direct investments to overcome climate issues on Monday at the WGS 2023. Speaking on the first day of the international summit, he said the challenge lies in the management of financial resources, estimating the world needs about $9 trillion of investment annually to tackle climate action and about $1 trillion annually to exert energy transition in many countries.

The IFC on Monday signed an agreement with the Abu Dhabi Fund for Development on a joint $1.5 billion investment in emerging markets energy transition.

(Writing by Seban Scaria seban.scaria@lseg.com; editing by Daniel Luiz)