The past year has witnessed greater multi-stakeholder consensus on the need for sustainability. Decision-makers understand that for sustainability to elicit greater participation, it needs a strong business case.
In other words, widespread sustainable transformation is achievable if there are financial incentives.
This could potentially start a green industrial revolution with a staggering economic value.
According to a study published in 2017 by the Business & Sustainable Development Commission, sustainable businesses can unlock at least $12tn in new market value.
So, how can stakeholders in the Middle East and North Africa (Mena) region tap into these trends?
Broadly, impact investing is any capital deployment made to generate a positive social and environmental impact besides financial returns.
Venture capitalists and big-money investors are increasingly subscribing to impact investing, hoping to grow their exposure to environmental, sustainable and governance (ESG)-linked assets.
This, in turn, has created a “green” segment in their investment portfolios. And to woo these investors, businesses are enhancing their ESG ratings through measurable actions.
As it turns out, all involved parties are reaping the rewards. According to a survey conducted in 2020 by the Global Impact Investing Network, more than 88 per cent of impact investors reported that their investments met or exceeded their expectations.
Within the Mena region, impact investing opportunities are rife in the agricultural sector, food systems and water conservation.
Since regional economies are overspending on energy-intensive desalination plants and food imports, ventures that can create measurable impact can help draw the capital towards them.
Potential investors and beneficiaries must have well-defined objectives. Emphasis should be on the measurability and reporting of outcomes, and progress must be tracked every step of the way.
The interface between entrepreneurship and ecology, or “ecopreneurship”, encapsulates the priorities that are key to addressing the region's deeply intertwined challenges.
Food and water scarcity are rooted in the arid climate, desert conditions, limited groundwater reserves and agricultural distress, among other systemic issues.
As per World Bank estimates, only 5.56 per cent of the total landmass in the Mena region is considered arable.
Take the example of the UAE, where agriculture accounts for nearly 72 per cent of water use. Given that only 0.5 per cent of the land in the UAE is arable, this water usage is excessive.
This scenario calls for innovative technologies to address issues and unlock higher agricultural yields.
Forward-thinking economies such as the UAE are organising conclaves and facilitating incubators for “ecopreneurs” to showcase plausible solutions and contribute to national food security strategies.
For instance, as part of the Abu Dhabi Agriculture and Food Security Week in November 2021, the Global Forum for Innovations in Agriculture (GFIA) enabled a platform to showcase business solutions to inspire change.
Dake Rechsand made a business case for transforming deserts into arable lands through breathable sand technology — a solution that could help “ecopreneurs” unlock agricultural potential in deserts, thereby challenging the conventional notions surrounding lack of arability.
In a region with vast, uncultivated deserts, the opportunities are limitless.
Public-private partnership models
Previously, public-private partnership (PPP) models were looked at solely from an economic perspective, with the private sector financing government projects, taking all the risk and drawing profits after that.
Such archaic models ran the risk of privatisation and left much to be desired in terms of public return on investment.
Today, with strong institutions, a balanced regulatory environment, equitable risk sharing and the intermediary roles played by intergovernmental organisations, it is possible to make PPP models work for all stakeholders.
As Mena nations step up their economic diversification pursuits and look for avenues for partnerships, innovative PPP models geared towards achieving food and water security merit greater attention.
The UAE’s Ministry of Education has promoted the application of breathable sand in schools, while the Ras al-Khaimah Municipality has agreed to plant 1,000 trees using the technology. These developments represent ways in which PPP models can work to benefit larger sustainability goals.
The business case for sustainable food and water security found greater clarity and consensus in 2021, even as the Mena region witnessed complementary forces.
Egypt and the UAE are set to host the Cop27 and Cop28 climate change summits, respectively. These conferences could shed more light on regional struggles and foster global multi-stakeholder participation, which is paramount for discernible impact.
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