MENA SUSTAINABLE FINANCE MARKET HITS $35.1BN IN 2025, SHOWS REPORT

The Middle East and North Africa’s (MENA) sustainable finance market reached $35.1bn in 2025, driven by financial institutions and energy-related issuers, according to a new report by Bloomberg Intelligence.

The report found that MENA sustainable finance issuance has expanded sevenfold since 2020, although the total fell 18 per cent from its 2023 peak amid global market headwinds.

Financial institutions now dominate the sector, accounting for nearly half of issuance, up from 32 per cent in 2020, reflecting increased regulatory support and lending activity as banks adopt sustainability frameworks and decarbonise their balance sheets.

How the GCC supported the move towards sustainable finance

Saudi Arabia emerged as the region’s largest issuer in 2025, with $19.7bn in issuance, supported by its 2024 Green Financing Framework, overtaking the UAE.

Read: Saudi Arabia: CMA issues rules for green, sustainable debt instruments

Green-labelled instruments, the largest segment, rose 60 per cent to $25.8bn, funding renewable energy, low-carbon infrastructure, and water-efficiency projects, with growing demand linked to regional data centre expansion.

UAE banks, including First Abu Dhabi Bank and Emirates NBD, played a key role in underwriting and lending, supporting sustainability-linked instruments and green bonds.

The UAE Banking Federation’s Dhs1tn sustainable finance target by 2030 underpins expectations of long-term growth, with Bloomberg Intelligence estimating a potential $2tn opportunity across renewables, water, and low-carbon infrastructure.

Strengthening the foundations for future growth

“While issuance eased in 2025 in line with global trends, the shift toward bank-led and green-labelled financing reflects a more durable market structure well positioned for further growth,” said Grace Osborne, ESG analyst at Bloomberg Intelligence.

She added that regulatory progress in the region is strengthening the foundations for future growth, although the lack of a harmonised regional taxonomy limits transition activity classification.

The report also noted that adoption of International Sustainability Standards Board-aligned disclosures, climate risk assessment, and transition planning is expected to become a key differentiator for issuers seeking sustainable capital.

Rising investment in AI-driven data centres is likely to further focus attention on energy efficiency, water security, and climate-resilient infrastructure.

2026-01-14T03:42:07Z