At COP27 in Sharm el-Sheikh, Egypt, the Climate Investment Coalition (CIC), in collaboration with the Nordic Council of Ministers, presented key investor recommendations to bridge the climate finance and investment gap by 2030 towards emerging markets and developing economies. This was made alongside an overview of Nordic pension fund progress within climate and clean energy investments in 2022.

Despite financial challenges and a volatile economic environment, the first wave of pension fund reporting in 2022 indicates that the Nordic pension funds are still on course to reach their target of US$130 billion by 2030. This is also the case for investments in emerging markets and developing economies, where new investments in climate solutions have continued to increase. The total, collective reporting of annual investments is expected to be announced in the first quarter of 2023.

Insurance & Pension Denmark reported today that Danish pension funds have invested US$9 billion in new clean energy investments since July 2021. This indicates that Danish pension funds are on track and well over halfway to reaching their 2019 commitment to invest DKK350 billion (today US$47 billion) by 2030. This is also the case for new investments in emerging markets and developing economies, which are proving to be on track.

This follows the CIC’s landmark announcement at COP26 of a US$130 billion collective, total commitment from Nordic and UK pension funds towards clean energy and climate solutions to be invested globally by 2030.

“The Climate Investment Coalition’s collective commitment of US$130 billion for climate investments by 2030 sent an important signal to other investors, policymakers and businesses that finance is ready and available to support the net-zero transition. Despite the numerous challenges of 2022, CIC investors are on track to reach their climate investment targets, including within emerging markets. But more must be done, faster; practical steps, such as finance vehicles, frameworks and partnerships will accelerate climate investments to flow to emerging markets, to ensure we support climate resilient development,” says Peter Damgaard Jensen, Co-Chair, Climate Investment Coalition

However, to support the significantly greater increase in climate and clean energy investments in emerging and developing markets, required to put their economies on a credible path to deliver on development and climate goals, substantive and accelerated investments are urgently needed.

To support the bridging of the climate finance and investment gap by 2030, the CIC and its Nordic pension fund members will seek to mobilise new and increased financial commitments for climate investments by 2030.

To make this happen, the CIC and its members will collaborate with international organisations, development finance institutions (DFI’s) and governments to build strategic public-private partnerships and multilateral climate finance models aiming to accelerate climate investments in emerging markets and developing economies.

“Africa has a pool of talented people with promising business opportunities waiting to be harvested together” says H.R.H Princess Abze Djigma, Initiator and Leader, MAMA-LIGHT® Initiative.

At the event, the CIC and Nordic pension funds outlined the following key recommendations to governments and their development partners for focus areas where intensified action will help catalyse investment and private finance flows to emerging markets and developing economies:

Foster enabling environments for investment through policy, regulation and planning that create predictable investment opportunities at scale, enabling private capital to invest in the energy transition.

Increase the scale and predictability of pipelines of clean energy investment opportunities. Clarity on the direction of travel and the commitment by governments to the energy transition is key to enhancing investor confidence in the availability of a continued flow of investment opportunities.

Promote, facilitate and scale innovative public-private financing approaches and instruments, where relevant backed by concessional, philanthropic and blended finance.

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