UK Export Finance (UKEF) has united global export credit agencies to form the Net Zero Export Credit Agencies Alliance, unveiled at the COP28 summit. Supported by the UN’s Environment Programme Finance Initiative, this coalition aims to drive action among export credit agencies and EXIM banks, striving for net zero emissions by 2050. Partnering with the Glasgow Financial Alliance for Net Zero, it currently includes UKEF, Export and Investment Fund of Denmark (EIFO), Export Development Canada (EDC), and the Swedish National Export Credits Guarantee Board and Swedish Export Credit Corporation (EKN and SEK) as full members. Additionally, ECAs from the UAE, Kazakhstan, and Spain have joined as affiliates.
UKEF, committed to achieving net-zero total financed emissions by 2050, ceased new support for overseas fossil-fuel projects in 2021, except in rare cases. Other Alliance members are following suit, pledging to achieve net zero in their portfolios and operations by mid-century.
Tim Reid, CEO of UK Export Finance, said: “Export credit agencies play a crucial role in helping businesses to transition towards net zero and shifting finance flows towards climate-friendly projects and investments. This new alliance mobilises export finance in support of a common goal: achieving global net zero by 2050 and limiting global warming to 1.5 degrees. I look forward to working with UKEF’s counterparts around the world to support this journey.”
This announcement follows a change earlier this year to the OECD Arrangement which allows export credit agencies to offer greater incentives for climate-friendly transactions.
Eric Usher, Head of UNEP FI, said: “Public finance has been the missing piece in the net-zero financial landscape. ECAs are in a very strong position to deliver more sustainable global trade and to complement the work already being undertaken by the private finance sector, helping to address market gaps to deliver net-zero economies by 2050. NZECA will play an important role in supporting real economy transition and help countries implement their commitments under the Paris Agreement.”
Simultaneously, during COP28, UKEF disclosed its involvement in securing multimillion-pound financing for initiatives promoting climate adaptation and sustainability across Africa and the Middle East. Notably, it announced a role in securing £226 million for the Iraqi government, facilitating the development of over 350km of drainage infrastructure and 15 sewage treatment stations near Hillah city—an endeavor set to provide clean water to an additional 25,000 households.
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