The Middle East and North Africa (Mena) sustainable finance market has undergone structural evolution, growing sevenfold since 2020 despite easing to $35.1 billion in 2025—18 per cent below its 2023 peak—due to global market headwinds, a Bloomberg Intelligence report highlights.

The market has diversified from being primarily sovereign-led to one anchored by financial institutions and energy issuers.

Financials accounted for nearly 50 per cent of 2025 issuance, up from 32 per cent in 2020, reflecting stronger regulation and bank-led decarbonisation initiatives.

Saudi Arabia became the region’s largest issuer at $19.7 billion, surpassing the UAE, supported by its 2024 Green Financing Framework.

Green-labelled instruments represented $25.8 billion, mainly funding renewable energy, low-carbon infrastructure, and water-efficiency projects, with potential growth from expanding data-center capacity.

UAE banks, including First Abu Dhabi Bank and Emirates NBD, played a key role through green bonds, sustainability-linked instruments, and lending, aligned with the UAE Banking Federation’s AED 1 trillion ($272 billion) sustainable finance target by 2030.

Regulatory progress underpins long-term growth, though the absence of a harmonised regional taxonomy limits transition-activity classification.

Moving toward ISSB-aligned disclosures, issuers increasingly require forward-looking climate risk assessment and transition planning.

Rising investment in AI-driven data centres will intensify focus on energy efficiency, water security, and climate-resilient infrastructure, shaping the region’s sustainable finance trajectory.