Stock Exchange join forces with stakeholders for Energy Transition Goals

The Ghana Stock Exchange (GSE) is taking a proactive stance in advancing the nation’s energy transition objectives, with Managing Director Abena Amoah announcing a collaborative effort with key stakeholders to raise capital.

Despite strides made through the Ghana National Energy Transition Framework, which aims for net-zero emissions by 2070, substantial funding, estimated at $562 billion, is still required.

Ms. Amoah stated at the ‘Ring the Bell for Climate’ event that the GSE aims to partner with the Ghana Carbon Market Office of EPA and other capital market stakeholders. Their goal is to develop climate finance and carbon trading mechanisms that not only tap into domestic capital but also attract regional and international investments to support Ghana’s just transition targets.

The GSE has already taken significant steps toward sustainable financing, introducing a Sustainable Bond Market Segment on its fixed income market. This segment allows issuers to list green and other sustainable bonds, facilitating funding for projects with climate or environmental benefits.

Moreover, the GSE has collaborated with member exchanges to endorse the WFE Green Equity Principles, providing a global framework for ‘green’ offerings of listed equities. This effort extends to advocating for increased local ownership in Ghana’s green earth minerals, exemplified by the listing of Atlantic Lithium on the GSE.

Promotion

The GSE’s pivotal role in promoting sustainable financial practices goes beyond the initiatives mentioned earlier. Notably, the exchange has been a driving force in fostering awareness and education about sustainable investment opportunities.

Through workshops, seminars, and collaborative efforts with environmental organizations, the GSE aims to empower investors with the knowledge to make informed decisions aligned with environmentally responsible practices.

This commitment to financial literacy not only strengthens the Sustainable Bond Market Segment but also positions the GSE as a catalyst for a broader cultural shift towards sustainable investing within Ghana’s financial landscape. As the GSE continues to champion these efforts, it stands as a beacon for other stock exchanges, demonstrating the potential for financial markets to contribute significantly to the global transition towards a more sustainable and resilient future.

The ‘Ring the Bell for Climate’ event, spearheaded by the World Federation of Exchanges (WFE), coincided with the United Nations’ Conference of Parties (COP28) in Dubai. The conference highlighted conflicting views, particularly regarding the phasing-out of fossil fuels. COP28 President Sultan al-Jaber’s assertion that there is no scientific basis for such a phase-out drew criticism, including a stern rebuke from former US Vice President Al Gore.

Ultimately, COP28 concluded with a consensus to shift away from fossil fuels without explicitly endorsing a complete phase-out, aligning with the UAE Consensus. This historic move calls for substantial reductions to limit temperature rises to 1.5°C and signifies a global commitment to transitioning away from fossil fuels, potentially reshaping economies worldwide.

However, the agreement lacks clear directions on climate finance, raising concerns among advocates who stress the importance of support from developed countries.

Developing nations like Ghana heavily rely on this assistance to address climate challenges and reduce dependence on fossil fuels. Tensions persisted as the Organisation of the Petroleum Exporting Countries (OPEC) urged members to reject any deal targeting fossil fuels, underscoring the complex global dynamics surrounding energy transition efforts.