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Africa must not be short-changed by climate finance, says expert panel at COP24
Climate change presents a US$3 trillion investment opportunity in Africa by 2030 – and the private sector will be key to green investment and development, Barbara Buchner, one of the top 20 influential women in climate change, has said. ,
Buchner, who is also the Executive Director for Climate Finance Program at Climate Policy Initiative (CPI) lent her voice to those of other experts at the Finance Day organized by the African Development Bank at COP24 in Katowice, Poland.
A range of high-profile speakers set out the challenges and opportunities for financing adaptation and mitigation efforts across Africa over four fascinating sessions, including Innovative Financing Solutions, Drive Billions to a Sustainable Economy in Africa, Inclusive Policies, and Finance for Sustainable Energy Access.
Buchner set the scene by reminding the audience that 14% of the world’s’ population lives in sub-Saharan Africa, yet only 3% of global climate finance flows into the continent.
She shared useful insights from her work on the Global Innovation Lab for Climate Finance initiative, emphasizing that a public-private approach is key to its effectiveness.
“Since launching in 2014, the Global Innovation Lab for Climate Finance has launched 35 transformative solutions, collectively mobilizing US$1 billion in mitigation and adaptation efforts around the world,” she said.
“But financial solutions are not enough. We need the right enabling environment to attract investment at scale. We’ve developed a programme with McKinsey to provide governments with legal, technical and financial support to allow this to happen.”
Panel speakers called for innovative approaches to attract and steer financial ﬂows consistent towards low-carbon and climate-resilient development to achieve the NDCs that Africa has set out.
Statistics have it that Africa offers the highest returns compared to most emerging market economies. For the last two decades, the continent has seen steady economic growth underpinned by commodity exports, growing market demand, and strengthened structural elements.
Between 2011 and 2015, and as part of its previous Climate Change Action Plan(CCAP), the African Development Bank mobilized approximately US$12 billion of climate finance to support climate-resilient and low-carbon development in Africa. Nonetheless, Africa has not succeeded as much as other regions of the world in mobilizing the funding needed to implement climate-smart initiatives.
With new Green Climate Fund (GCF) finance now available to be channeled through the Bank, African countries will have additional resources to access.
David Jackson, Director of Local Development Finance at UN Capital Development Fund (UNCDF), said: “Adaptation is going to be a very expensive process; it’s also a localized process. It can only be done by those responsible for land-use planning, agriculture, water management, transport etc.”
Jackson emphasized the need to encourage access at a local level and to set up national platforms for adaptation, which bring together national and local governments.”
Experts emphasized how programming adaptation efforts presents a unique challenge given the evolving nature of climate risks, associated uncertainties, and existing implementation issues.
Gareth Phillips, Chief Climate Change and Green Officer at the African Development Bank, said: “Strengthening the capacities of national and subnational bodies to access, manage, and channel finance and collectively work together is critical to making adaptation happen at the speed and scale we need. At the same time, we have to do better at engaging national and sub-national stakeholders in the decision-making process. Unlocking finance is critical to achieving the African NDCs.”
The African Development Bank is working closely with international climate funds as well as other partners to scale up climate finance on the African continent and to strengthen institutions to directly access climate funds.
In the words of Akinwumi Adesina, President of the African Development Bank: “Africa’s financial actors need to work together creatively to mobilize global financial resources at a scale that can support local innovation, and that drives climate-resilient and low-carbon development on the continent. Having been short-changed by climate change, Africa must not be short-changed by climate finance.”
The Bank’s climate spending will increase to 40% of its total new investments by 2020 compared to 26% on average from 2011 to 2014.
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