At Cop28, UAE sets up US$30 billion fund to bridge global climate finance gap

Dubbed Alterra, the fund will allocate US$25 billion towards climate strategies and US$5 billion to incentivise investment flows into the Global South

Alterra was established by Lunate, a newly set up Abu Dhabi-based alternative investment manager with over US$50 billion in assets

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Sheikh Mohammed bin Zayed Al Nahyan, the president of the United Arab Emirates and the ruler of Abu Dhabi, speaks at an opening ceremony at the Cop28 summit. He announced the establishment of a US$30 billion climate fund for global climate solutions that aims to attract US$250 billion of investment by the end of the decade. Photo: AP

Published: 7:18pm, 1 Dec 2023Updated: 10:17pm, 1 Dec 2023

United Arab Emirates President Sheikh Mohammed Bin Zayed Al Nahyan, whose country is hosting the Cop28 climate summit, announced on Friday the establishment of a US$30 billion climate fund for global climate solutions that aims to attract US$250 billion of investment by the end of the decade.

Dubbed Alterra, the fund will allocate US$25 billion towards climate strategies and US$5 billion specifically to incentivise investment flows into the Global South.

In collaboration with global asset managers BlackRock, Brookfield and TPG, Alterra has committed US$6.5 billion to climate-dedicated funds for global investments, including the Global South, the statement from the Cop28 presidency said.

The vehicle “aims to steer private markets towards climate investments and focus on transforming emerging markets and developing economies, where traditional investment has been lacking due to the higher perceived risks across those geographies”, it added.

BlackRock said Alterra would put US$1 billion into its climate transition-oriented private debt strategy, and had also committed US$1 billion to invest in, or co-invest alongside, BlackRock’s infrastructure equity business.

Brookfield Asset Management said it was launching a new catalytic transition fund, which will focus on developing countries, with up to US$1 billion of Alterra cash. Alterra has also committed to invest US$2 billion into its second Brookfield global transition fund.

Alterra was established by Lunate, a newly set up Abu Dhabi-based alternative investment manager with over US$50 billion in assets.

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