Developing countries are facing a massive investment shortfall in the renewables sector and require debt relief to create fiscal space that supports clean energy transition to meet their climate and sustainable development goals.
They require about $1.7 trillion per year in the clean energy sector but only managed to attract foreign direct investment worth $544 billion in 2022, the UN Conference on Trade and Development (Unctad), said in its World Investment Report on Wednesday.
“International investment in renewable energy has nearly tripled since the adoption of the Paris Agreement in 2015. However, much of this growth has been concentrated in developed countries,” Unctad researchers said in the report.
“More than 30 developing countries have not yet registered a single utility-sized international investment project in renewables.”
With interest rates soaring globally, the cost of capital is a key barrier for energy investment in developing countries that are grappling with mounting external debt, with limited fiscal space.
“Bringing in international investors in partnership with the public sector and multilateral financial institutions significantly reduces the cost of capital,” the report said.
The UN body called for the “de-risking of energy transition investment” through loans, guarantees, insurance instruments and the equity participation of the public sector and multilateral development banks.
“De-risking support to lower the cost of capital for energy transition investment in developing countries must be vastly expanded,” the Unctad researchers said.
The total funding needs of developing countries for the energy transition are much larger and include investment in power grids, transmission lines, storage and energy efficiency.
Developing nations face an annual funding gap of $2.2 trillion when it comes to the energy transition, a key requirement for these nations to achieve their climate goals.
This funding gap is part of a total $4 trillion annual shortfall they are facing in terms of sustainable development goals, Unctad said.
“A significant increase in investment in sustainable energy systems in developing countries is crucial for the world to reach climate goals by 2030,” Unctad secretary general Rebeca Grynspan said.
To stay close to the goal of limiting global warming to 1.5°C above pre-industrial levels, the world needs about one-and-a-half times the current global gross domestic product in investment between now and 2050, Unctad said.
However, after a steep drop in 2020 and a strong rebound in 2021, global FDI declined by 12 per cent in 2022, to $1.3 trillion.
The slowdown was driven by global crises, including the war in Ukraine, high food and energy prices, and mounting debt pressures.
International project finance and cross-border mergers and acquisitions were especially affected by tighter financing conditions, rising interest rates and uncertainty in capital markets, and Unctad expects pressure on global FDI to continue this year.
“Global FDI trends are in line with other macroeconomic variables, which show either negative or slow growth rates,” Unctad researchers said.
“Early indicators confirm the negative FDI outlook: FDI project activity in the first quarter of 2023 shows that investors are uncertain and risk averse.
“The number of international project finance deals in the first quarter of 2023 was down significantly; cross-border M&A [merger and acquisition] activity also slowed.”
Although FDI in developing countries last year increased by 4 per cent to $916 billion, or more than 70 per cent of global flows, the rise was uneven across countries, with much of the growth concentrated in a few large emerging economies.
The number of greenfield investment projects announced in developing countries increased by 37 per cent, and international project finance deals by 5 per cent, which are “positive signs for investment prospects in industry and in infrastructure”, the report said.
However, FDI in Africa dropped to the 2019 level of $45 billion after “anomalously high levels in 2021”, caused by a single financial transaction.
Greenfield project announcements increased by 39 per cent and international project finance deals by 15 per cent.
FDI inflows in developing Asia were flat at $662 billion but still accounted for more than half of global FDI, with India and members of the Association of South-east Asian Nations being the top recipients.
China, the second-largest FDI host country in the world, registered a 5 per cent increase last year, the report said.
FDI flows to Latin America and the Caribbean increased by 51 per cent to $208 billion, the highest level ever recorded.
Although FDI flows to the Gulf region declined overall, the number of project announcements increased by two thirds, according to the report.
Sustainability-themed investments remained resilient last year, with the value of the overall sustainable finance market reaching $5.8 trillion in 2022, despite high inflation, rising interest rates, poor market returns and the looming risk of a recession that all affected financial markets.
Sustainable funds continued to be more attractive to investors than traditional funds.
Despite a decline in the market value of the global sustainable fund market from its high of $2.7 trillion in 2021 to $2.5 trillion in 2022, net inflows to the market were positive, in contrast to traditional funds, which experienced net outflows, the Unctad report said.
As part of efforts to tackle climate change, public pension and sovereign wealth funds have also developed an increased focus on sustainability strategies, directing more of their assets towards the energy transition.
Renewable energy has become an attractive infrastructure sub-segment for these institutional investors, offering the stable, inflation-hedging qualities of infrastructure while supporting net-zero objectives.
“With a long-term investment horizon, SWFs and PPFs are uniquely positioned for investing in infrastructure and energy, including the renewable energy sector, and have become important investors in the sectors,” the Unctad report said.
“Between 2016 and 2022, PPFs and SWFs significantly increased their investment in renewable energy, driven by policy changes aimed at decarbonising, the continuously decreasing costs of renewables and the need for portfolio diversification.”
Last year, these funds invested $18.7 billion in renewable energy projects, a 21 per cent decline from 2021, but still almost double the annual average since 2016, Unctad said.
Canadian pension funds were the largest source of capital for investment in renewable energy, accounting for 33 per cent of total investment in 2022.
GCC investors contributed 29 per cent while Singaporean funds accounted for 26 per cent.
GIC in Singapore was the largest single investor, followed by Abu Dhabi's Mubadala Investment Company.
“Gulf SWFs are important investors in renewable energy, as they seek to diversify domestic and regional economies and progress towards the Paris Agreement goals,” the Unctad report said.
WOMAN AND CHILD
Director: Saeed Roustaee
Starring: Parinaz Izadyar, Payman Maadi
Rating: 4/5
Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
UAE currency: the story behind the money in your pockets
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
MATCH INFO
Uefa Champions League, semi-final result:
Liverpool 4-0 Barcelona
Liverpool win 4-3 on aggregate
Champions Legaue final: June 1, Madrid
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants
Profile
Name: Carzaty
Founders: Marwan Chaar and Hassan Jaffar
Launched: 2017
Employees: 22
Based: Dubai and Muscat
Sector: Automobile retail
Funding to date: $5.5 million
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
SERIE A FIXTURES
Saturday Benevento v Atalanta (2pm), Genoa v Bologna (5pm), AC Milan v Torino (7.45pm)
Sunday Roma v Inter Milan (3.30pm), Udinese v Napoli, Hellas Verona v Crotone, Parma v Lazio (2pm), Fiorentina v Cagliari (9pm), Juventus v Sassuolo (11.45pm)
Monday Spezia v Sampdoria (11.45pm)
RESULTS
Lightweight (female)
Sara El Bakkali bt Anisha Kadka
Bantamweight
Mohammed Adil Al Debi bt Moaz Abdelgawad
Welterweight
Amir Boureslan bt Mahmoud Zanouny
Featherweight
Mohammed Al Katheeri bt Abrorbek Madaminbekov
Super featherweight
Ibrahem Bilal bt Emad Arafa
Middleweight
Ahmed Abdolaziz bt Imad Essassi
Bantamweight (female)
Ilham Bourakkadi bt Milena Martinou
Welterweight
Mohamed Mardi bt Noureddine El Agouti
Middleweight
Nabil Ouach bt Ymad Atrous
Welterweight
Nouredine Samir bt Marlon Ribeiro
Super welterweight
Brad Stanton bt Mohamed El Boukhari
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
Marathon results
Men:
1. Titus Ekiru(KEN) 2:06:13
2. Alphonce Simbu(TAN) 2:07:50
3. Reuben Kipyego(KEN) 2:08:25
4. Abel Kirui(KEN) 2:08:46
5. Felix Kemutai(KEN) 2:10:48
Women:
1. Judith Korir(KEN) 2:22:30
2. Eunice Chumba(BHR) 2:26:01
3. Immaculate Chemutai(UGA) 2:28:30
4. Abebech Bekele(ETH) 2:29:43
5. Aleksandra Morozova(RUS) 2:33:01
The Bio
Amal likes watching Japanese animation movies and Manga - her favourite is The Ancient Magus Bride
She is the eldest of 11 children, and has four brothers and six sisters.
Her dream is to meet with all of her friends online from around the world who supported her work throughout the years
Her favourite meal is pizza and stuffed vine leaves
She ams to improve her English and learn Japanese, which many animated programmes originate in
The Laughing Apple
Yusuf/Cat Stevens
(Verve Decca Crossover)
Killing of Qassem Suleimani
The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%201.8-litre%204-cyl%20turbo%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E190hp%20at%205%2C200rpm%0D%3Cbr%3E%3Cstrong%3ETorque%3A%3C%2Fstrong%3E%20320Nm%20from%201%2C800-5%2C000rpm%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESeven-speed%20dual-clutch%20auto%0D%3Cbr%3E%3Cstrong%3EFuel%20consumption%3A%3C%2Fstrong%3E%206.7L%2F100km%0D%3Cbr%3E%3Cstrong%3EPrice%3A%3C%2Fstrong%3E%20From%20Dh111%2C195%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3ENow%3C%2Fp%3E%0A
Why are asylum seekers being housed in hotels?
The number of asylum applications in the UK has reached a new record high, driven by those illegally entering the country in small boats crossing the English Channel.
A total of 111,084 people applied for asylum in the UK in the year to June 2025, the highest number for any 12-month period since current records began in 2001.
Asylum seekers and their families can be housed in temporary accommodation while their claim is assessed.
The Home Office provides the accommodation, meaning asylum seekers cannot choose where they live.
When there is not enough housing, the Home Office can move people to hotels or large sites like former military bases.
Pharaoh's curse
British aristocrat Lord Carnarvon, who funded the expedition to find the Tutankhamun tomb, died in a Cairo hotel four months after the crypt was opened.
He had been in poor health for many years after a car crash, and a mosquito bite made worse by a shaving cut led to blood poisoning and pneumonia.
Reports at the time said Lord Carnarvon suffered from “pain as the inflammation affected the nasal passages and eyes”.
Decades later, scientists contended he had died of aspergillosis after inhaling spores of the fungus aspergillus in the tomb, which can lie dormant for months. The fact several others who entered were also found dead withiin a short time led to the myth of the curse.
The specs
Price, base / as tested Dh960,000
Engine 3.9L twin-turbo V8
Transmission Seven-speed dual-clutch automatic
Power 661hp @8,000rpm
Torque 760Nm @ 3,000rpm
Fuel economy, combined 11.4L / 100k
What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
Brief scores:
Toss: Nepal, chose to field
UAE 153-6: Shaiman (59), Usman (30); Regmi 2-23
Nepal 132-7: Jora 53 not out; Zahoor 2-17
Result: UAE won by 21 runs
Series: UAE lead 1-0
More from Neighbourhood Watch:
War 2
Director: Ayan Mukerji
Stars: Hrithik Roshan, NTR, Kiara Advani, Ashutosh Rana
Rating: 2/5
