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The momentum around environmental, social and governance (ESG) is building in Qatar driven by several government initiatives, efforts to diversify the economy and increasing requirements for disclosure on sustainable activities and reporting. The ESG trend has the Middle East investment community buzzing with excitement, as ESG considerations are being increasingly factored into investments and emerged as the most common approach to sustainable investing, said Invest Qatar in its recent report.
The shift toward sustainability will fundamentally change how countries need to think about competitiveness and investment attraction, noted the report entitled ‘Road to ESG investing: Financing Sustainable Growth in Qatar’.
Acknowledging the significance of ESG in driving FDI and shaping the future of the investment landscape, the Investment Promotion Agency Qatar (IPA Qatar) pursues its crucial role of promoting and facilitating investment across sustainable development sectors in Qatar, in line with the Qatar National Vision 2030.
"Attracting sustainability-conscious investors, providing them with investment solutions, and connecting them with relevant stakeholders to channel their investments to lucrative opportunities remain at the core of IPA Qatar’s objectives," said the report.
The report provides an overview of the integral role of FDI in advancing sustainability initiatives and underlines the array of sustainable finance opportunities in Qatar. It also sets out further analysis and recommendations on the transition toward ESG-based investments.
Citing the UN estimates that in the Arab countries the report noted that financing gap for achieving the Sustainable Development Goals (SDGs) targets is estimated to be at least $230bn annually.
“The ongoing efforts by Qatar present a lucrative opportunity for both – sustainable financial investors looking for investment opportunities as well as businesses keen on expanding their international operations. International project finance has been a key source of investment in productive capacity, especially for large-scale projects in energy, transport infrastructure, and natural capital, and Qatar is an emerging hotspot of such ESG-aligned projects.”
The report stated that IPA Qatar is making a concerted effort through a range of approaches to attract and capture the ESG benefits from FDI. Some of the efforts include providing a platform to access the available mix of financial, fiscal, and regulatory incentives for business set-up, targeting investment in particular sectors and activities through the right partner connections and introduction facilitation and reducing information asymmetries and other barriers to investment.
As a single and complete source for investment solutions, IPA Qatar helps connect investors to the right people, resources, and platforms throughout the investment process.
IPA Qatar acts as a gateway for investors to get access to key stakeholders – regulators, lawmakers, supervisors, financial institutions, large corporations, SMEs, NGOs, and universities that have been playing an inalienable role in sustainable development. The recent milestones achieved by the nation have been made possible by these different entities working in tandem with each other to achieve a common goal.
“Sustainable investment is a key opportunity and Qatar is looking to attract both issuers and investors to its capital markets to boost its financial sector. The journey to becoming a preferred landing place for such investments is still ongoing, and dedicated efforts are underway by all the major stakeholders involved,” the report said.
“Ongoing initiatives reflect Qatar’s unwavering commitment to realise its sustainability goals, and the planned initiatives will require substantial investment for execution. As a case in point, Qatar Energy is committed to zero routine flaring by 2030 along with a long-term goal to reduce flaring in onshore facilities to the absolute minimum. At the beginning of 2021, Qatar Energy updated its sustainability strategy in 2022 in alignment with the goals of the Paris Agreement and set in motion a plan to reduce greenhouse gas emissions by 35 percent by 2030,” it added.
