The Middle East and North Africa (MENA) Voluntary Carbon Market (VCM) is officially here and five leading Saudi businesses have signed a memorandum of understanding to become its first potential partners.
The VCM initiative was first announced in September 2021, where His Royal Highness Crown Prince Mohammad bin Salman Al-Saud Crown Prince stated Saudi Arabia’s leading role in contributing to the reduction of the impact of climate change.
The MENA Voluntary Carbon Market is formed by Saudi’s Public Investment Fund (PIF). The new partners announced are Aramco – the world’s biggest oil producer, SAUDIA, ACWA Power, Ma’aden, and ENOWA, a subsidiary of NEOM.
They will aim to support PIF in the development of the VCM through the supply, purchase and trading of carbon credits as the market is expected to be established in 2023. Additional partners will be announced in the coming months.
“We would like to thank our Partners for their commitment to the Voluntary Carbon Market, the first of its kind in the MENA region. The support of Saudi businesses, which are world leaders in their fields, is a strong demonstration of the exciting potential of this market,” said Yasir Al-Rumayyan, Governor of PIF.
What makes the idea of the very first VCM in the MENA region exciting is that it will pursue carbon credits that offer the highest quality and integrity in the market. That has always been an issue with common government carbon credits schemes, as they often lack traceability and 100% guarantee money spent leads to actual emissions reductions.
UAE and other Middle Eastern countries have also stated their own net-zero 2050 pledges and could potentially join the MENA VCM. It is essential for large companies like Saudi Aramco to cut their emissions and they claim carbon credits are vital in their move to achieve net zero.