According to the World Health Organisation (WHO), the impact of climate change could cause approximately 250,000 additional deaths per year due to malnutrition, malaria, diarrhea, and heat stress. Sub-Saharan African countries will need to develop their health infrastructure to address these challenges. 

The WHO believes if climate change remains in Africa, the increased weather and climate variability will expose a wider than expected population to extreme heat, drought, and floods, thereby expanding the poverty burden.  

Sustainable financing has increased over the period, and there is an upward trend worldwide in which the primary focus is on green energy to address Climate change and global warming. The result has been that many businesses have invested in energy efficiency and waste management.  

One tool that provides immense opportunities for financing sustainable development in Nigeria and Africa is the 'Green Sukuk.' The Green Sukuk is a strategic product in the Non-Interest Finance Space, designed to provide funding for sustainable projects around the globe. 

It is used to finance environmental projects such as renewable energy. 

Green Sukuk has raised awareness of environmental issues among Islamic finance investors and attracted conventional investors aware of Islamic finance instruments. Islamic finance is a system in which financial activities occur in compliance with Shariah (Islamic rules), such as risk-sharing, prohibition of riba (interest), Gharar (exposure to excessive risk) and Maysir (speculative behaviour). 

It focuses on long-term infrastructure projects, human capital development, and sustainable finance and is asset-backed. Sukuk is a Shariah-compliant financial instrument which is an alternative to conventional bonds. Due to its potential, Sukuk has attracted investors, and the market is evolving.  

According to Salaam Gateway, the Economic, Social, and Governance (ESG)-focused Sukuk will continue to grow faster. Among the leaders in ESG Sukuk issuances are: 

• Islamic Development Bank 
• Government of Malaysia 
• Government of Indonesia 
• Saudi Electricity Company 
• Majid al Futtaim 
• Saudi National Bank 

Green Sukuk can finance environmentally friendly projects and has been adopted by several Muslim countries. The Sukuk has provided quality jobs, preserved the environment, and created renewable energy, leading to stable electricity and an asset class that can outperform pension funds.      

Nigeria can use Green Sukuk to finance renewable energy, fund transportation and increase investments in education and healthcare. 

The federal government, states, local governments, corporates, institutions, communities, or cooperatives can leverage 'Green Sukuk' and 'Diminishing Musharakah' to finance long-term financing projects. 

According to Fitch ratings, Sukuk will continue to see its growth in transactions in 2022, following a solid 2021 performance in which outstanding global Sukuk reached over US$700 billion. One major trend in the Sukuk market that is expected to continue throughout 2022 is the focus on environmental, social and governance (ESG) activities and the increase in the issuance of green Sukuk.