UAE Launches $30 bn ALTERRA Climate Fund to Galvanize $250 Billion Investments by 2030

ALTERRA climate fund

United Arab Emirates President Sheikh Mohammed Bin Zayed Al Nahyan, hosting the COP28 climate summit, unveiled the ambitious ALTERRA climate fund, a $30 billion initiative aimed at attracting $250 billion in investments by the decade’s end.

As part of this groundbreaking commitment, ALTERRA will dedicate $25 billion to bolster climate strategies and allocate an additional $5 billion to incentivize investment flows into the Global South, as highlighted in a statement released by the COP28 Presidency.

In partnership with global asset management giants such as BlackRock, Brookfield, and TPG, ALTERRA has pledged $6.5 billion to climate-focused funds, including initiatives targeting the Global South. This collaborative effort intends to redirect private market interests towards climate-centric investments, particularly in emerging markets and developing economies where perceived risks have traditionally hindered substantial investments.

According to statements from BlackRock, ALTERRA’s commitment involves injecting $1 billion into its Climate Transition-Oriented Private Debt strategy and an additional $1 billion for investments or co-investments alongside BlackRock’s infrastructure equity business. BlackRock’s Chief Executive Larry Fink emphasized the transformative potential of this initiative, stressing the critical need to address underserved regions globally.

Brookfield Asset Management also announced its involvement, launching the Catalytic Transition Fund exclusively for developing countries, backed by up to $1 billion from ALTERRA. Additionally, ALTERRA has committed $2 billion to invest in Brookfield’s second Global Transition Fund.

Lunate, an Abu Dhabi-based alternative investment manager with over $50 billion in assets, spearheads ALTERRA’s operations. Owned by senior management and Chimera Investment, a part of Sheikh Tahnoon bin Zayed Al Nahyan’s business empire, Lunate represents a significant force behind this transformative climate initiative.

Amid critiques directed at the UAE for expanding oil and gas production amidst global concerns over carbon emissions, the country is actively promoting financial and business sectors to contribute to the climate cause. The unveiling of ALTERRA aligns with the UAE’s broader commitment to spearhead climate action, underlining its willingness to engage financially and support the global fight against climate change during the two-week U.N. climate summit.