Exploring carbon market instruments for the Kingdom of Saudi Arabia (KSA)

Abstract

As more and more countries prepare net-zero pledges under the Paris Agreement, the Kingdom of Saudi Arabia (KSA) has a specific concept: the Circular Carbon Economy (CCE), targeting carbon circularity by building a competitive advantage on clean hydrogen and carbon capture utilisation and storage (CCUS) technologies. The concept is nationally endorsed and the next steps now need to be elaborated. How best should technological and financial efforts be designed? This policy brief analyses the different elements of a potential carbon market for KSA, considering the country’s economic and competitive strengths, its plans to diversify its economy, and calls for a long-term low-carbon strategy for the country.