Three steps for Africa to combat climate change
PRESS RELEASE
Policy paper defining continent’s stance ahead of COP27 receives backing of African leaders including Ghana President, Nigeria Vice President
Lagos, 19 September 2022 – With hopes for countering global warming pinned on progress at the upcoming COP27 UN Climate Change Conference in Egypt, a report from the Africa Finance Corporation (AFC), Africa’s leading infrastructure solutions provider, sets out the continent’s stance by balancing the need for emissions reduction with critical development imperatives.
The report, Roadmap to Africa’s COP: A Pragmatic Path to Net Zero, is set within a context where Africa has borne the brunt of the most devastating impacts of climate change, while contributing little to global emissions. This low carbon output reflects Africa’s crippling energy deficit, which has stymied industrialisation and economic development. Africa, therefore, needs a realistic agenda for addressing climate change which allows the region to also continue advancing its industrial base.
“Africa is unlike any other continent when it comes to global net zero – and we need a blueprint for a common negotiating stance that reflects this,” said Samaila Zubairu, President and CEO of AFC. “We are advocating for consideration of Africa’s energy deficit and the need for quantum leaps in industrialisation for job creation and reducing poverty, as well as climate-proofing built infrastructure and protecting our powerful carbon sinks.”
The report has received the backing of prominent African leaders, including H.E. Nana Akufo-Addo, President of Ghana: “This document provides us a basis on which we can then go forward to adopt a common position at COP27. Hopefully we will find an opportunity within the structure of the African Union to use this as a base document for a discussion as to what our common position should be for COP27.”
H.E. Yemi Osinbajo, Vice President of Nigeria, said: ”The white paper sets out very clearly and simply the roadmap for success, and I think that the basic elements – localising, rebuilding and finnovating – are very important and powerful concepts.”
Chair of the African Group of Negotiators at COP26, Tanguy Gahouma, commented: ”The white paper from AFC speaks on three pillars - localise, build and finnovate - and we really think this is what Africa needs.”
The report argues that, while cutting emissions is vital for the more developed and highest polluting wealthier nations, there is a more limited universal impact to be gained from reducing the far lower emissions of sub-Saharan Africa. The report concludes that African nations will drive a far greater effect in combatting global warming by focusing instead on three significant areas of change.
1. Localise
According to the report, Africa must focus on developing local industries by putting processing and manufacturing at the centre of sustainable circular economies. Doing so will reduce emission-spewing shipments of Africa’s minerals and other commodities to Asia for manufacturing and processing, only to be shipped again as finished goods to consumer markets.
Achieving this objective requires closing Africa’s energy deficit. While renewable sources are the ultimate goal, in the near-term Africa must exploit its abundant reserves of natural gas. Since much of Africa is already at net zero, such development can be achieved without contributing substantially to global carbon emissions, while channeling harmful gas flares from oil fields and reducing the use of more polluting fuels such as coal, diesel and firewood. Resultant job creation and economic growth will enable African nations to invest further in renewable sources.
Especially important is creating local manufacturing of the components of renewable energy technology. It is critical for these metals to be mined in such a way that minimises further pollution and for resource-efficient sustainable mining techniques to be combined with ecosystems fostering local production centres.
2. Re-build
Africa is the most exposed region to the ravages of global warming largely because its infrastructure is ill equipped to withstand climate shocks. Without intervention, the cost of structural damage caused by natural disasters in Africa will increase to US$415 billion a year by 2030 from between US$250 billion to US$300 billion now, according to the UN Office for Disaster Risk Reduction.
The continent needs strong and resilient building — to re-build ocean and river defenses, and infrastructure in transport, construction, electricity grids and off-grid energy, which will in turn help the development of sustainable mining and the circular economies that drive growth and job creation, according to the report.
3. Finnovate
Key to effecting change is ensuring that Africa-based institutions such as the AFC get access to essential climate funds through financial innovation to support resilient building and investment in localised mass-scale manufacturing and processing. Financing is also needed to help preserve Africa’s vast carbon sinks, which absorb more carbon dioxide annually than any other region’s rainforests but are being depleted by local populations for firewood for cooking and heating.
Working with development finance institutions, governments and institutional investors, AFC’s many projects over the course of 15 years demonstrate that it is possible to mobilise financing at scale through crowding in private sector investment. Through leveraging financial input from governments and NGOs, we have the tools to de-risk climate investments and offer strong returns to incentivise funding from institutional investors. These efforts can help ensure that capital flows to the frontlines of the fight against climate change—Africa.
“This document will inspire us to do something," Benedict Oramah, President and Chairman of the Board of Directors of the African Export–Import Bank (Afreximbank), said in reference to the white paper. "The circular economy argument underpins the work we are doing under the AfCFTA to create the regional supply chains that we require.”
Dr. Carlos Lopes, Professor at the Mandela School of Public Governance at the University of Cape Town, and the former executive secretary of the United Nations Economic Commission for Africa, said: “This report brings key messages that are very important.”
AFC supports energy transition and economic development in Africa through US$10 billion of investments across 35 countries. Projects include AFC’s joint venture, ARISE IIP with an operational Nkok Special Economic Zone (SEZ) in Gabon, the Cabeolica Wind Farm in Cape Verde (the first commercial-scale privately financed public private partnership (PPP) wind farm in Sub Saharan Africa), and the €174 million investment in the construction of Cote d’Ivoire’s Singrobo hydroelectric dam. The corporation recently announced the joint acquistion of Lekela Power, Africa’s largest pure play renewables independent power producer (IPP), with plans to double generation capacity within four years.
Access the full white paper here: https://s3.eu-central-1.amazon...
About AFC
AFC was established in 2007 to be the catalyst for private sector-led infrastructure investment across Africa. AFC’s approach combines specialist industry expertise with a focus on financial and technical advisory, project structuring, project development and risk capital to address Africa’s infrastructure development needs and drive sustainable economic growth.
Fifteen years on, AFC has developed a track record as the partner of choice in Africa for investing and delivering on instrumental, high-quality infrastructure assets that provide essential services in the core infrastructure sectors of power, natural resources, heavy industry, transport, and telecommunications. AFC has invested over US$10 billion in 35 countries across Africa since inception.
Media Enquiries:
Yewande Thorpe
Communications
Africa Finance Corporation
Mobile : +234 1 279 9654
Email : yewande.thorpe@africafc.org
Gavin Serkin
New Markets Media & Intelligence
Telephone: +44 20 3478 9710
Email: gserkin@newmarkets.media