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The Japan Bank for International Cooperation (JBIC; Governor: MAEDA Tadashi) signed on February 24 a Memorandum of Understanding (MOU) with the Public Investment Fund ("PIF"; Governor: His Excellency Yasir Al-Rumayyan) to strengthen a partnership between the two organizations.
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PIF is Saudi Arabia's sovereign wealth fund which plays a leading role in advancing Saudi Arabia's economic transformation and diversification by entering into long-term investment opportunities in 13 strategic sectors in Saudi Arabia and globally. The purpose of the MOU is to promote PIF and Japanese companies' collaborative projects in Saudi Arabia by strengthening the cooperation between JBIC and PIF and its portfolio companies in a variety of sectors such as decarbonization, digital transformation, and smart city development, which are global opportunities.
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At the G20 summit hosted by Saudi Arabia in 2020, the Government of Saudi Arabia advocated promoting a Carbon Circular Economy and in October 2021, announced that it aims to reach net-zero carbon emissions by 2060. In addition, it aims to increase the proportion of renewable energy in the country's energy mix to 50% by 2030 under Vision 2030, the national transformation plan of Saudi Arabia. These demonstrate the commitment of Saudi Arabia to reducing the country's dependence on oil sales, diversifying the economy, and transitioning to renewable energy.
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In the Fourth Medium-term Business Plan, released in June 2021, JBIC aims to respond to energy transformation toward the realization of a decarbonized society. In addition, in its ESG Policy released in October 2021, JBIC stated that in order to align with the international goals to achieve the objectives of the Paris Agreement, JBIC is committed to pursuing ambitious and accelerated efforts to reduce its operational greenhouse gas emissions to net zero by 2030, and to achieve net zero emissions in its finance portfolio by 2050. The ESG Policy adds that through continued engagement with the relevant national governments and authorities, JBIC will contribute to realizing global carbon neutrality by supporting and accelerating the energy transition toward a decarbonized society of emerging and developing countries. The signing of the MOU is in line with the Medium-term Business Plan and ESG Policy.
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As Japan's policy-based financial institution, JBIC will continue to provide financial support to create business opportunities and promote business for Japanese companies in a variety of sectors including decarbonization in Saudi Arabia by enhancing relations with Saudi Arabia and PIF through multiple means such as signing of MOUs.
