Climate finance has been central to UNFCCC discussions for many years and, while some progress has been made, the financing gaps are increasing, leading to frustration and mistrust by developing countries who continue to experience unprecedented impacts of climate change from the rising costs of loss and damage.
While African countries formulated ambitious NDCs requiring up to USD 3 trillion between 2020 to 2030 for implementation, there has been no sign of predictable and accessible finance to meet these needs.
Will COP27 be any different?
Why CoP27 and actions beyond must deliver on climate finance for Africa
The Africa climate projections from the Sixth Assessment of the Intergovernmental Panel on Climate Change (IPCC) indicate that much of the continent will be drier, and rainfall more erratic and intense, leading to floods and droughts. Sea level rise poses a big threat to coastal cities, infrastructure and farmland. The projected warming trajectory of 2.4oC is likely to make many parts of Africa uninhabitable.
Addressing the impacts of multidimensional climate risks and shocks is not a choice for Africa. The combination of increasing slow onset events and extreme weather shocks, the debt burden coupled with impacts of the Covid-19 pandemic and the war in Ukraine, will make it more difficult to adapt. African countries have experienced a large rise in external borrowing as a result of the COVID-19 pandemic, due to large losses in fiscal revenue, which makes it difficult to finance basic social services including meeting adaptation costs. Governments will have no option than to rely on international markets for the funds needed to survive. This trajectory does not give much choice to African countries to address the damage from climate impacts amidst rising oil prices bringing higher costs of transport in Africa as well as food prices.
the total annual climate finance flows in Africa for 2020, domestic and international, were only USD 30 billion, about 12% of the amount needed and climate finance structures are seen to be biased against climate-vulnerable countries who receive less of the available funds.
Moving from rhetoric and false promises to supporting genuine partnerships to finance adaptation
The COP26 outcomes show the political aspiration of having a 50:50 balance between mitigation and adaptation, but climate finance flows demonstrate that adaptation finance is only between 20 and 25 per cent of committed concessional finance across all sources COP26 urged developed nations to at least double their collective provision of adaptation finance from 2019 levels by 2025, to help achieve this balance between adaptation and mitigation, but progress with doubling adaptation finance is yet to be seen. So, what needs to happen?
Public private partnerships in mobilising adaptation finance
Addressing the climate crisis requires joined up efforts. No single government will be able to provide adequate financing. The World Inequality report 2022 noted that during the Covid crisis, governments borrowed the equivalent of 10-20% of GDP from the private sector. The current low wealth of governments in Africa has direct implications on their capacity to tackle climate change and other shocks.
Loss and damage as a result of climate hazards also has a reverse effect on the availability of financial resources as people get pushed back into poverty. This will increasingly affect national economic growth, constraining capabilities for adaptation.
This will require both Africa and Europe to be flexible and address the regulatory and market barriers to address adaptation, through equitable and ethical public-private partnerships that focus on responsible business conduct.
Linking Climate finance and development finance
Africa’s development and climate priorities are interlinked, so there is no way development can be effective without focusing on ‘’climate resilient development’’. The recent IPCC report notes that climate resilient development is enabled when governments, civil society and the private sector make inclusive development choices that prioritise risk reduction, equity, and justice.
While African governments have been talking about mainstreaming climate change across sectors, adaptation efforts are still fragmented, focusing on immediate climate risks or near-term risks, without a long-term view to address the slow onset of many impacts.
This also requires that Europe effectively climate proofs its overseas development assistance to ensure that it is complementary to adaptation funding outcomes. IIED’s work on “tracking adaptation, measuring development” assesses how adaptation interventions can reduce climate vulnerability and keep development on course, offering valuable guidance.
It is time to move from planning for adaptation to implementation of forward-looking adaptation responses that consider the long-term nature of the climate risks.
Supporting a just and inclusive transition; who is paying the cost?
Principles of equity and justice need to be taken into consideration when addressing issues of transition to ensure that Africa does not shoulder the responsibility of decarbonising.
The question is not yet resolved of how low carbon and just transitions are going to be funded given the different needs between Africa and Europe. The recent African Ministers’ meeting in Cairo called for expansion of climate financing for the continent while pushing back against an abrupt move away from fossil fuels, since this could threaten Africa's development.
The IPCC 6th assessment report recognised the role of colonialism in exacerbating climate impacts. Influencing Africa’s development pathways should build on existing policies and ongoing efforts to meet development and climate objectives, rather than a narrow focus on mitigation pathways, some of which might not address Africa’s immediate challenges. Energy transitions risk becoming “carbon colonialism” if transformations are imposed by Northern donors or perceived as such.
At Cop26, African leaders noted that poorer countries cannot be expected to remake their economic and energy systems as quickly as wealthy ones. Africa is rich in fossil fuels, has emitted very few greenhouse gases, and is keen to use fossil fuels to spur the continent’s economic transformation.
A new form of multilateralism based on ethical and equitable principles is needed
The governance of climate change requires multiple multi-scale partnerships engaging international cooperation, African Governments, Philanthropies, civil society, social movements, investors, medium and small-scale enterprises among others.
The bureaucratic procedures around access to climate finance need to be demystified through genuine partnerships, acknowledging that we are racing against time, this is a global crisis, and we all have a duty and responsibility to act swiftly, using our different capabilities.
Innovative groupings and financing mechanisms like the Least Developed Countries initiative for Adaptation and Resilience that are led by developing countries are needed to address the climate crisis. Informal multilateralism around common problems with ability to challenge and reimagine the nature of climate partnerships and outcomes will be key.
The success of these partnerships however depends on enabling political leadership and accountability, strong institutions, and resources, including finance, which remains central to addressing adaptation.
Global leaders in New York, Bali or Sharm el Sheikh, must recognise that there is no more time. The global crises including climate change have pushed inequality further affecting the most vulnerable countries and populations. Our global interconnectedness should highlight the value of working together for our one planet and galvanise action in true and equitable partnerships to address the climate and development crisis.
CoP27 - often referred to as the African CoP - should be the moment to deliver tangible outcomes to address the multiple challenges the continent is facing.