Qatar's Commercial Bank is 'Excited' about Issuing Green Bonds
Masraf Al-Rayan, Qatar's first Sharia-compliant green deposit, was established in April.
Qatar's Commercial Bank has expressed interest in issuing green bonds, but only after confirming that the funds will be used for green and sustainable initiatives. That's according to Joseph Abraham, the company's CEO, who was speaking at a conference in Doha.
"There's a huge pool of investor funds available," Abraham told Reuters. "I think if you're a credible institution with a credible track record and proper governance around it, your bond will automatically be effective."
Green bonds are used to fund environmentally friendly initiatives with a focus on sustainability, such as green buildings.
The relevant regulators and stock markets in the Gulf countries are keeping a close check on the environmental, social, and governance (ESG) matters, according to the CEO. Qatar is reportedly working to establish sustainable economic practices in order to enhance green morale and contribute to the development of a sustainable country.
The Qatari government's stance on green bonds
In a late March interview with Bloomberg, Qatar's Minister of Finance Ali Al-Kuwari revealed the country's plans to issue green bonds. He did say, however, that the timing of its release is determined by market conditions.
Qatar held talks with international banks in January, according to the news agency, in an attempt to raise billions of dollars through green bonds.
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"At the end of the day, we believe that gas is a much cleaner energy source than oil," Al-Kuwari added, reiterating Doha's commitment to prioritizing the use of clean energy sources. You have to properly identify where you're going to spend the money in any green bond issuance, and it needs to be used on green initiatives."
Qatar's environmental initiatives
Masraf Al-Rayan, in accordance with Sharia Law, launched the country's first green deposit in April.
The money will be used to fund environmental, social, and governance (ESG) initiatives. Clients who want to take a more environmentally friendly approach to their enterprises can put money into these sustainable deposits to fund various ESG projects.
Under its revised strategy, the company is going to increase the carbon intensity of Qatar’s liquified natural gas facilities by 35 percent instead of the initial target of 25 percent.
The intensity of its upstream facilities is also going to be lowered by 25 percent instead of 15 percent.
In February, Qatar National Bank and HSBC, based in the United Kingdom, introduced a green energy-focused monetary tool in an effort to expand banks' and companies' short-term sustainable finance choices.
HSBC would borrow money from QNB in exchange for green bonds under the buyback deal. The borrowed funds would then be used to support efforts that encourage the deployment of low-carbon technologies in projects.
As part of its 'Climate Change Action Plan,' the Gulf country announced goals last year to reduce greenhouse gas emissions by 25% by 2030.
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