As the global need for sustainable finance continues to surge, the GCC is using it as a critical lever for economic diversification and progress towards achieving net-zero targets, an industry report said.
Sustainable finance has a pivotal role in driving economic growth, job creation, and diversification across the GCC, the report by KPMG Lower Gulf and First Abu Dhabi Bank (FAB) said.
The report, titled ‘The Sustainable Finance Imperative’, examined how climate-smart investments, estimated to total $23 trillion across emerging markets, and other instruments are reshaping the region’s economic future.
The report outlined how the GCC’s focus on green investments is projected to contribute up to $2 trillion to regional GDP by 2030, primarily through sectors such as renewable energy and sustainable infrastructure.
FAB, the UAE’s largest bank, has facilitated AED 216 billion in sustainable and transition financing projects – 43 per cent of its 2030 target of AED 500 billion – as ESG-focused financing is driven by clear client demand.
The report said green investments are expected to create over one million jobs by the end of the decade, with the UAE already committing $16.8 billion toward renewable energy initiatives.
Fadi Al Shihabi, Partner and ESG Services Leader at KPMG Lower Gulf, said the report illustrates how sustainable finance is not only transforming the GCC’s economic landscape but is also creating critical opportunities for diversification and value creation.
“As the region transitions to a low-carbon economy, financial institutions and policymakers must collaborate to leverage these opportunities and build a more sustainable and resilient future,” he said.
Flagship projects such as the Mohammed bin Rashid Al Maktoum Solar Park in the UAE and the NEOM Green Hydrogen project in Saudi Arabia are leading examples of how sustainable finance is enabling large-scale, climate-resilient developments, the report said.
The report also emphasised the critical role of sustainable finance in attracting foreign direct investment (FDI) and fast-tracking economic diversification.
“By aligning financial flows with national sustainability strategies, the GCC is establishing itself as a global leader in sustainable finance,” it said.
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