Making the Green Transition Work for People and the Economy 2025

Fossil fuel exporters In the World Economic Forum’s equitable transition country archetype framework, fossil fuel exporters are primarily high- and middle-income countries where the production and export of fossil fuels have a significant impact on the economy, although some of them have already embarked in ambitious diversification plans. They are located in the Middle East and Northern Africa and in Central Asia. One-third of businesses in these countries indicate slow return on investment (ROI) as a key barrier to stay competitive in the green transition, making it the most cited concern. Lack of green skills and limited access to green technologies also represent a more significant bottleneck to climate competitiveness than in the rest of world, with one out of five executives citing them as key barriers (above global averages of 15% and 16%, respectively). With science, technology, engineering and mathematics (STEM) graduates representing less than a third of tertiary output in several countries in this archetype, businesses may struggle to recruit the expertise needed to deploy innovative solutions at scale.On the other hand, businesses from fossil fuel exporters are less concerned about regulatory uncertainty (17% vs. 36% globally) or the increases in costs of energy and key commodities (32% vs. 37% globally). These countries can rely on abundant domestic energy reserves with energy subsidies still widespread in many cases across the economy. Businesses and governments in these countries may be able to harness today’s resources to build tomorrow’s resilience, patiently investing for the long-term in human capital, green innovation, access to and rollout of clean technologies. More than one out of three companies in Saudi Arabia mention organizational culture and resistance to change as one of the key barriers that hinders their capacity to stay competitive in the green transition, making it the most urgent challenge in the country (only one out of five businesses highlight the same challenge globally and in peer countries). A similar number of businesses highlight higher cost of energy and key commodities and slow ROI among their main challenges, in line with global averages, while one out of five are concerned with affordability and demand for green products, above global and peer averages. Making the Green Transition Work for People and the Economy 21