DUBAI - In a significant move towards sustainable finance, the Dubai Financial Market (DFM) has announced the launch of a carbon credit trading pilot program. This initiative, set to begin from December 4-8, 2023, is aimed at bolstering the market's environmental, social, and governance (ESG) efforts in anticipation of the upcoming Cop28 conference.
The pilot program will initially open trading exclusively for institutional investors. It has already drawn participation from over 17 prominent UAE companies, including logistics giant DP World and banking heavyweight Emirates NBD. The Dubai Electricity and Water Authority (Dewa) is poised to lead the supply of verified carbon credits, which will be available through brokerages such as Al Ramz Capital. These credits will either be Verra-certified or sanctioned by the United Nations.
As part of the broader strategy to support sustainable urban development, Dubai Municipality has joined as a partner in this pioneering venture. This move aligns with similar efforts in the region, such as the Abu Dhabi Global Market (ADGM), which has established a regulated exchange with AirCarbon Exchange.
The window for carbon offsetting within this pilot framework is scheduled to close by January 10, 2024. Looking ahead, there are strong indications that by 2030, the voluntary carbon market could see its value soar beyond $50 billion. This projection underscores the growing importance and potential of carbon markets in the global push for sustainability and climate action.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.