Unveiling at COP28, the Net-Zero Export Credit Agencies Alliance (NZECA) is a first of its kind worldwide effort including public financial institutions. It was called upon by the United Nations (UN). This alliance is dedicated to assisting the shift to net-zero economies by 2050. It was formed in collaboration with the UN Environment Programme Finance Initiative (UNEP FI), Future of Climate Cooperation, eight prestigious export credit agencies, and the Innovation and Knowledge Hub at the University of Oxford.
Europe, the Middle East, and North America are among the different regions represented by the three affiliates and the five founding members of NZECA.
With an expected value of US$120 billion in 2022, these organizations—which include well-known organizations like Sweden’s Svensk Exportkredit (SEK) and EKN, the UK’s Export Finance, and Export Development Canada (EDC)—were instrumental in promoting international trade. According to a UNEP news release, the export credit sector is a significant actor in world trade, impacting up to $28 trillion, or 80–90%, of it. To achieve net-zero CO2 emissions by 2050, the founding members have committed to coordinating their greenhouse gas emissions and operational emissions with net-zero pathways by the middle of the century. By the end of 2024, they also pledged to stop providing additional direct subsidies to the fossil fuel energy industry.
This is in line with the Glasgow 2021 commitments made by 39 nations and development organizations.
The UAE’s Etihad Credit Export Insurance, Spain’s Cesce, and Kazakhstan’s KazakhExport are among the affiliate members dedicated to promoting net-zero greenhouse gas emissions and guaranteeing a fair transition. They will gain from exchanging information with top export credit agencies to hasten their transition to net zero.
Under the direction of a secretariat based in UNEP FI, the NZECA synchronizes its accountability and governance frameworks with those of other UNEP FI-convened alliances. Its function enhances cooperative efforts in the financial sector by supplementing current networks and national commitments. Furthermore, the Alliance features a specific work track for transition finance and climate solutions, and some members have made sizeable financial commitments to green technologies.
According to Inger Andersen, the executive director of UNEP, “public finance has been the missing piece in the net-zero financial landscape.” Export credit organizations are well-positioned to promote more sustainable international trade, support the efforts of the private finance sector, close market gaps, and contribute to the achievement of net-zero economies by the year 2050. This partnership will be crucial in assisting nations in carrying out their obligations under the Paris Agreement and in fostering a real economic transition.
