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IEA Pushes for $1T Investment In Clean Energy By 2030, To Achieve Net-Zero Emission By 2050

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International Energy Agency (IEA)- Investors King

The International Energy Agency (IEA) has said that investment in clean energy in emerging and developing economies need to rise more than seven times, topping $1 trillion per year by 2030, to put the world on track for net-zero emissions by 2050.

A report conducted with the World Bank and the World Economic Forum (WEF) by the IEA stated that without stronger action, energy-related carbon dioxide emissions from those economies – mostly in Asia, Africa, and Latin America – would grow by five billion tonnes over the next two decades.

It said while developing and emerging economies account for two-thirds of the world’s population, they receive only one-fifth of investment in clean energy.

Annual investments across all parts of the energy sector in developing and emerging markets have fallen by about 20 percent since 2016, it added, partly because of challenges including weak regulation and a lack of profitable clean energy projects.

According to the report, last year, $150 billion was put into renewables, adding that unless much stronger action was taken, the 2050 target may not be met.

“In many emerging and developing economies, emissions are heading upwards while clean energy investments are faltering, creating a dangerous fault line in global efforts to reach climate and sustainable energy goals.

“Countries are not starting on this journey from the same place – many do not have access to the funds they need to rapidly transition to a healthier and more prosperous energy future – and the damaging effects of the Covid-19 crisis are lasting longer in many parts of the developing world.

“There is no shortage of money worldwide, but it is not finding its way to the countries, sectors and projects where it is most needed. Governments need to give international public finance institutions a strong strategic mandate to finance clean energy transitions in the developing world,” the IEA Director, Fatih Birol, stated.

The report noted that recent trends in clean energy spending point to a widening gap between advanced economies and the developing world even though emissions reductions are far more cost-effective in the latter.

Besides, it stated that emerging and developing economies currently account for two-thirds of the world’s population, but only one-fifth of global investment in clean energy, and one-tenth of global financial wealth.

“Annual investments across all parts of the energy sector in emerging and developing markets have fallen by around 20 percent since 2016, and they face debt and equity costs that are up to seven times higher than in the United States or Europe,” it said.

Avoiding a tonne of CO2 emissions in emerging and developing economies costs about half as much on average as in advanced economies, according to the report, stressing that it is partly because developing economies can often jump straight to cleaner and more efficient technologies without having to phase out or refit polluting energy projects that are already underway.

Describing the report as a global call to action – especially for those who have the wealth, resources and expertise to make a difference – and offers priority actions that can be taken now to move things forward fast, Birol stressed that as the world expands energy access, it also needs a global transition to low-carbon energy.

World Bank Global Director for Energy and Extractives, Demetrios Papathanasiou, said the bank would continue to support countries that seek assistance to transition away from fossil fuels and scale up low-carbon, renewable energy, and energy efficiency investments.

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Investment

West and Central Africa’s Investment Environment and Infrastructure Opportunities in Spotlight

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Paris - Investors King

A new focus report produced by Oxford Business Group (OBG), in partnership with the international brokerage network Groupe Ascoma, will explore the increased focus on compliance, transparency and ethical practices in the West and Central African markets as the region looks to attract investment for its economic development.

Titled “Governance, Risk and Compliance in West and Central Africa”, the focus report will provide in-depth analysis of key issues relating to insurance and reinsurance, against the broader regional socio-economic landscape, in an easy-to-navigate and accessible format, featuring essential data and infographics.

The report will shine a spotlight on the way that doing business is evolving across the region’s economies at a time when ECOWAS members are keen to source funding for a vast range of intra-continental and domestic infrastructure projects.

Subscribers will find detailed coverage of the key role that private sector players such as Ascoma are expected to play in driving change and instilling a culture of insurance and reinsurance across business communities by identifying risks common to the region and providing effective, tailored solutions to them.

The report will examine specific areas of the economy in which governance, risk and compliance (GRC) principles are being given added weight, including energy, infrastructure, mining and the financial services industry.

It will also include an in-depth interview with Farid Chedid, CEO and Chairman, Groupe Ascoma, in which he explains how GRC dynamics are helping the company achieve its objectives, while supporting the region’s bid to make future economic growth sustainable. “Ascoma is committed to the economic and infrastructure development of Africa, and applying Global, Risk and Compliance principles is essential for our operations, not only in the continent but also in the Middle East and the rest of the world. Transparency, compliance, and business ethics are top priorities for us in the moment of investing in any country”. Commenting ahead of the signing of a Memorandum of Understanding for the report, Bernardo Bruzzone, OBG’s Regional Editor for Africa, said that the new report with Ascoma was timely, given the added importance that both corporations and governments are attaching to GRC principles.

“Business environments are changing globally on the back of new requirements from investors, with tighter regulations and greater transparency,” Bruzzone said. “Our research with Ascoma will plot the GRC trends that are gaining momentum regionally, while also highlighting the positive impact they could have on West and Central Africa’s potential as an investment destination.”

“Governance Risk and Compliance in West and Central Africa” will form part of a series of tailored reports which OBG is currently producing with its partners, alongside other highly relevant, go-to research tools, including a range of country-specific Growth and Recovery Outlook articles and interviews.

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How to Save, Invest and Earn in US Dollar in Nigeria

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Investment - Investors King

The continuous plunge in Naira value against global counterparts has made saving in US Dollar, US Dollar investments and earning in United States Dollar attractive to Nigerians and citizens of other import-dependent emerging economies.

In the last 18 months, Naira was devalued four times from N306/US$1 to the current Central Bank of Nigeria’s exchange rate of N410/US$1. However, Nigerian economic structure coupled with limited foreign revenue generation has created chronic dollar scarcity that made access to US Dollar at N410 impossible for most Nigerians and businesses that operate in the country.

This means, most Nigerians are forced to patronise the parallel market, popularly known as the black market, to exchange their hard-earned Naira or foreign currencies at much higher rates. A situation that has eroded the profitability of businesses, escalated the inflation rate, dragged on new job creation and weighed on consumer spending.

Currency experts have said Naira’s true exchange rate to American Dollar is at over N550 and it is inevitable given the mono-product nature of Africa’s largest economy. It means Naira will decline further, and subsequently, affect your future return on investments and business decisions.

Therefore, Investors King has put together how to navigate Naira uncertainties by saving, investing and earning in US Dollars while living in Nigeria.

How to Save Money in US Dollar in Nigeria

There are several ways Nigerians can save money in US Dollar, one of such ways, is to open a US Dollar (note that you can also open A Euro, Pounds Sterling) domiciliary bank account in any Deposit Money Bank in the country, exchange your Naira to US Dollar at the black market and save the exchanged US Dollar in your Domiciliary Bank Account.

While this is a conventional method, it is stressful and exposes one to all kinds of risk given that the black market is not regulated and usually conducted in the open.

However, the advent of Financial Technology (fintech) companies have helped ease the process and one can now save in US Dollar without visiting the black market or leaving the comfort of his/her home.

Companies like Trove Technologies Limited, Chaka Technologies Limited, Rise and Bamboo allow Nigerians to deposit in US Dollars from their Naira bank account.

Read about Securities and Exchange Commission regulatory issues with investment platforms.

Each of the platform quote Naira-US Dollar exchange rate for buying (exchanging Naira to US Dollar) and selling (exchanging US dollar to Naira) daily. With this, a potential depositor can determine the forex rate he/she wants to deposit.

Here is how to sign up on any of the platforms

Download their mobile application and click on signup. Complete the signup form and send in your identification for verification. Once approved, click dollar deposit and you will be redirected to the Naira-US dollar exchange rate and ask to transfer Naira from your Nigerian bank account to a designated bank account. The quoted rate will be used to credit your account in US dollars. The process is the same if you are withdrawing.

Now here is the logic, you can leave your money in US Dollar and wait until Naira decline further against US Dollar to profit from forex differential or start investing in US Dollar on the platform you deposit your US Dollar. To start investing and earn in US Dollar keep reading.

How to Invest in US Dollar in Nigeria

Each of these platforms has a partnership with a US-regulated stockbroker that allows them to offer foreign stocks to Nigerians. They also offer Nigerian stocks, meaning potential investors can trade global and local stocks on their phones with ease.

Therefore, you can learn to trade foreign stocks with as little as $20 dollars while saving simultaneously to give yourself an opportunity to profit from both your investment and Naira decline. The good thing about these platforms is that you can do all these with your smartphone. To learn how to trade foreign stocks, contact us.

Few other platforms, Cowrywise, Afrinvest, Stanbic IBTC, offer US Dollar investment opportunities.

Cowrywise – Dollar Mutual Fund investment

Investors can now invest in Cowrywise Dollar mutual funds called the United Capital Nigerian Eurobond Fund. “You’re probably wondering why it’s called a Eurobond fund when it’s a dollar-based investment option. We’re here to break it down for you,” Cowrywise stated.

Eurobond funds are a type of bond. This type of bond is issued in the host countries currency. A great example is that the Nigerian government can issue a bond that is denominated in dollars to allow foreign investors to have access to them too.

Now you’re probably wondering what a bond is. A bond is an agreement between two different parties. Another great example is that it’s like having a friend borrow from you and payback with a set interest rate. This means a government bond is simply the government borrowing money from the public with the agreement to pay back with a certain interest rate.

How to set up a Nigerian Eurobond investment plan

  1. Download the latest version of the Cowrywise app on the Playstore or Appstore.
  2. Signup and create a free account. You can log in after this.
  3. Tap “Actions”, followed by “Invest in Mutual Funds”.
  4. Select “Nigerian Eurobond Fund” to invest in.

Afrinvest Dollar Fund

The Afrinvest Dollar Fund is an open-ended mutual fund that Afrinvest invests in Dollar-denominated Securities registered in Nigeria.

The objective of the Fund is to achieve income generation and capital appreciation in the short to medium term for investors with dollars and designed to deliver significantly higher returns than what is obtainable from the average domiciliary account in the local banks. There is free entry and exit for investors subject to the prevailing Fund price.

  • Capital appreciation
  • Competitive returns
  • Diversified portfolio; and
  • Regular and steady income stream.

The issue price is $100 per unit but there is a minimum initial subscription of 10 units or US$1000. The minimum holding period is 180 days. This means your investment needs to stay untouched within this period.

The projected return is 6 to 7.5% per annum.

To subscribe, click any of the links below to get the subscription form. Email the completed form to aaml@afrinvest.com

Stanbic IBTC Dollar Fund

Stanbic IBTC Dollar Fund is similar to Afrinvest Dollar Fund.

Stanbic IBTC provides currency diversification, income generation, and stable growth in USD. The leading financial institution seeks to achieve this by investing a minimum of 70 percent of investors’ funds in high-quality Eurobonds, a maximum of 25 percent in short-term USD deposits, and a maximum of 10 percenr in USD equities approved and registered by the Securities and Exchange Commission of Nigeria.

Here is Highlight of Stanbic IBTC Dollar Fund

  • Stanbic IBTC Dollar Fund (SIDF) was launched in January 2017
  • The Fund invests a minimum of 70% of its portfolio in high quality Eurobonds, , maximum of 25% in short term USD deposits and a maximum of 10% in USD equities
  • 180 days minimum holding period
  • The penalty for redeeming within the minimum holding period is 20% on the accrued income
  • The minimum investment amount is $1,000 while additional investment is $500
  • It is an open ended Fund
  • The risk profile is “Moderately Conservative”
  • The expense ratio is 3.5%
  • The management fee is 1.5%

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deVere Launches ‘Green’ Investment Products as ESG Demand Soars

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Nigel Green - Investors King

Growing interest in environmental, social and governance (ESG) investing has prompted one of the world’s largest independent financial advisory and fintech organisations to unveil a new product to help clients benefit from this decade’s “ultimate megatrend.”

deVere Group will now be able to offer its clients a fixed-yield note of which the proceeds are allocated to the financing of eligible projects with a clear and defined environmental benefit, such as the reduction of carbon emissions.

In June last year, deVere revealed that 26% of clients around the world are eyeing exposure to or already have exposure to ESG investments. This has now increased to 44% over the last 12 months.

Of this new financial solution, Nigel Green, deVere Group CEO and founder says: “An increasing number of clients want to achieve profits with a purpose by investing in companies that prioritise reducing carbon, protect employees’ and consumer rights, and promote board diversity, corporate transparency and stakeholder accountability.

“As such, we feel it is our responsibility to bring to market financial solutions that can help them do this.”

“At the beginning of 2020 we identified that ESG will be this decade’s ultimate investment megatrend. Therefore, we will continue to develop products with legitimate ESG credentials.

He continues: “The ESG trend is set to gain further momentum for several reasons.

“First, governments and regulators are becoming increasingly pro-ESG which boosts investor confidence.

“For example, in the U.S. – the world’s largest economy – the Biden Administration is taking a tougher approach to the use of fossil fuels and is promising swift action to tackle climate change.

“In addition, the new chairman of the Securities and Exchange Commission (SEC), the U.S. financial regulator, Gary Gensler, is a proponent and is likely to strengthen investment and disclosure rules to help the U.S. catch up with Europe.”

He goes on to add: “Second, as millennials, who are statistically more likely to seek responsible investment options, become the major beneficiaries of the largest intergenerational transfer of wealth – an estimated $30tn in the next few years – we can expect both retail and institutional investors to continue to pile into ESG.

“And third, the pandemic has focused minds on the fact that the health of our planet directly affects human health which, in turn, affects the way we all live and work.”

As sustainable investments move from a ‘quirk’ or ‘nice to have’ to a legitimate portfolio diversification tool that delivers profits with purpose, deVere earlier this year announced it is to offer free, independent advice to clients on socially responsible investing, with the aim of positioning $1bn in environmental, social and governance investments within five years.

Of the new financial solution, Mr Green concludes: “This note is the next step in our sustainability journey. We look forward to developing more to help our clients with theirs.”

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