The partnership will utilize Islamic finance to combat climate change. The collaboration will open doors for promoting the Voluntary Carbon Market within the Organization of Islamic Cooperation (“OIC”). The partnership will open doors to provide advisory and financing services to businesses aiming to offset their carbon footprint or seeking to generate Carbon Credits from their activities.
The Regional Voluntary Carbon Market Company (“RVCM”) and The International Islamic Trade Finance Corporation (“ITFC”), member of the Islamic Development Bank (“IsDB”) Group, announced a partnership, which will utilize Islamic finance to combat climate change.
The partnership will open doors for promoting the Voluntary Carbon Market in the Organization of Islamic Cooperation (“OIC”) Member States and providing advisory and financing services to businesses aiming to offset their carbon footprint or seeking to generate Carbon Credits from their activities.
In order to facilitate the joint efforts, a Sharia resolution was obtained from the IsDB Group Sharia Board on trading Carbon Credit, which marks a significant moment in the global drive to address climate change by allowing carbon credits as a traded “Rights to Intangible Assets” enabling Islamic Financing. This, in turn, will spur faster action by paying project developers for their climate-positive action today rather than in the future.
This collaboration with RVCM marks a milestone towards ITFC’s strategy in the coming years to promote green financing and sustainable trade as it will facilitate deployment of ITFC financing and services to support its member countries’ efforts to reduce GHG emissions and increase their resilience.
Distributed by APO Group on behalf of International Islamic Trade Finance Corporation (ITFC).
About Regional Voluntary Carbon Market Company (“RVCM”):
The Public Investment Fund (PIF) announced the establishment of the Regional Voluntary Carbon Market Company, where PIF holds an 80% stake and Saudi Tadawul Group Holding Company (“Saudi Tadawul Group”) holds a 20% stake in the company. RVCM will offer guidance and resourcing to support businesses and industry in the region as they play their part in the global transition to net zero, ensuring that carbon credit purchases go above and beyond meaningful emission reductions in value chains.
The company’s establishment is a continuation of PIF initiatives to support Saudi Arabia’s green efforts and follows previous announcements by the Fund, including the completion of its USD 3 billion inaugural green bond, and the various renewable projects PIF is spearheading as part of its commitment to develop 70% of Saudi Arabia’s renewable energy capacity, in line with Saudi Vision 2030.
About the International Islamic Trade Finance Corporation (ITFC):
The International Islamic Trade Finance Corporation (ITFC) is a member of the Islamic Development Bank (IsDB) Group. It was established with the primary objective of advancing trade among OIC member countries, which would ultimately contribute to the overarching goal of improving the socio-economic conditions of the people across the world. Commencing operations in January 2008, ITFC has provided US$66 billion of financing to OIC member countries, making it the leading provider of trade solutions for these member countries’ needs. With a mission to become a catalyst for trade development for OIC member countries and beyond, the Corporation helps entities in member countries gain better access to trade finance and provides them with the necessary trade-related capacity-building tools, which would enable them to successfully compete in the global market.