Dubai Islamic Bank (DIB) has set up a new green financing framework ahead of issuing green and sustainable Shariah-compliant bonds (sukuk), the bank said in a statement on Friday. The bonds will be used to fund projects pertaining to renewable energy, energy efficiency, sustainable transport, green buildings and wastewater management.

DIB is the first Islamic bank in the UAE to set up this kind of green financing framework, the statement notes. The bank already has several sustainable financing initiatives in place, including a green auto offering for electric and hybrid vehicles, it says. Standard Chartered Bank supported DIB to develop the framework, the statement tells us.

The GCC specifically has been spearheading green bond issuances in the past few months: Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), sold USD 3 bn in green bonds earlier this month that was nearly 6x oversubscribed. Similarly, Abu Dhabi Commercial Bank (ADCB) raised USD 500 mn in a green bond sale in September — an issuance that was almost 4x oversubscribed, demonstrating strong investor demand in sustainable bonds.

AND- Egypt had kicked it all off back in 2020: Egypt pioneered the use of green bonds in MENA, taking the region’s first sovereign green bond issuance to market in 2020, raising USD 750 mn from investors to channel into green projects. Egyptian-headquartered bank CIB also issued Egypt’s first corporate green bond in 2021, raising USD 100 mn in a five-year, fixed-rate offering.

And it plans to issue more: Egypt wants to roll out USD 500 mn in green bonds before the end of the fiscal year, which ends in July 2023, Egypt’s Finance Minister Mohamed Maait told Bloomberg Asharq on Thursday, reiterating previous statements from the ministry. But the issuance hinges on “the betterment of global economic conditions,” he added.