Last month, Saudi Arabia’s Public Investment Fund (PIF) issued green bonds — a financial instrument used to raise funds for environmentally friendly projects — for the first time. Entering debt capital markets for the first time, PIF raised $3 billion, which will contribute to the overall sum of $10 billion that the fund aims to invest in green projects by 2026. PIF has been tasked with helping the Saudi economy diversify away from oil.
Saudi Arabia has committed to a number of ambitious climate goals. The country aims to reduce carbon emissions by 278 million tons a year by 2030, as well as increase its renewable energy generation capacity by 50%. The country’s leading oil powerhouse — Saudi Aramco — has also committed to net zero operational emissions by 2050, with the country itself aiming for net zero by 2060. PIF aims to finance this transition through green bonds.