Efforts to decarbonize high-emission industries in the UAE continue at full pace, with Mashreq Bank offering two separate sustainability-linked financings.
AED 126 million (USD 34.3 million) sustainability loan to Gargash Group
The first facility, amounting to AED 126 million (USD 34.3 million), was extended to Gargash Group, one of the UAE’s leading automotive companies. It stands out as one of the largest sustainable financing deals in the country’s automotive sector.
The agreement is tied to measurable ESG (Environmental, Social, and Governance) goals such as reducing carbon emissions, improving energy efficiency, and strengthening employee development programs. It also includes provisions to encourage more transparent and accountable corporate governance.
Gargash Group plans to implement a transformation plan focused on solar energy and energy-saving technologies, offering a clear example of how the traditional internal combustion engine-based automotive industry can transition toward environmental goals.
Green steel financing agreement with AGSI
Mashreq’s second agreement was made with Arabian Gulf Steel Industries (AGSI), the UAE’s largest private steel producer and recycler. This AED 126 million (USD 34.3 million) green loan will support AGSI’s low-carbon steel production ambitions.
AGSI has documented its ability to produce carbon-neutral steel, emitting only 0.13 tons of CO₂ per ton of steel. The company plans to produce 5 million tons of green steel by 2030 and reduce emissions by 95% compared to conventional production methods.
Mashreq’s Head of Corporate and Investment Banking, Joel Van Dusen, stated that AGSI is setting a new benchmark in the industry. Meanwhile, Faisal AlShimmari, Head of ESG, emphasized that such financing structures have now become strategic tools.
AGSI utilizes locally recycled raw materials and sources a significant portion of its energy from renewables. To date, its production model has helped eliminate 7.28 million tons of carbon emissions.
Mashreq’s 2030 goal: USD 30 billion in sustainable financing
Mashreq Bank has committed to providing USD 30 billion in sustainable financing by 2030. These latest agreements mark concrete steps toward that target, reinforcing the bank’s role in supporting eco-friendly transitions across key industries.
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