INSIGHTS & IDEAS

Climate finance has failed Africa. African countries receive a grossly insufficient amount of climate finance, falling far short of what they require. For the period 2020-2030, the average annual climate funding needs for Africa are estimated at around $33.5b for adaptation, $72b for mitigation, and $36.5b for loss and damage, totaling $142b. However, annual climate flows to Africa currently stand at only $30b. If the same level of climate funding persists throughout the period 2020-2030, there will be an annual shortfall of $112b – amounting to a total climate finance gap of $1.1tn. At COP26, the advanced countries promised to double global adaptation funding by 2025, which would amount to an additional $40b per year for Africa. However, Africa would still face a total shortfall of at least $820m for the decade.

Six Priorities for Africa at COP27

Three immediate actions:

Multilateral agencies and development finance institutions should:

  • Deliver technical assistance to African countries and streamline climate fund processes to improve access to already available climate finance.
  • Improve capacity building and technology transfers to enhance the transition to low-carbon economies and help access Africa’s huge carbon stocks for job creation and development.
  • Invest in two or three renewable energy manufacturing centers in Africa to produce products such as solar panels and batteries for the African market.

Three new long-term targets and goals:

  • To close the climate finance gap, rich countries need to make a strong commitment to $1.3tn in climate funding for Africa for the period 2020-2030 to cover the costs of climate adaptation, mitigation, and loss and damage.
  • Africa’s long-term energy transition to net zero has to include natural gas as a transition fuel, and climate funding should be made available for natural gas development projects.
  • The global financial architecture has to be reformed to better serve developing countries and address the climate crisis. More innovative instruments such as green bonds, green loans, debt-for-climate swaps, and climate-linked debt should be made available; unused Special Drawing Rights should be reallocated for climate finance, and climate funding processes need to be streamlined and made more transparent.

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This policy brief was featured in the latest edition of our newsletter African Transformation Quarterly, which focused on Climate & Agriculture. You can read view the entire newsletter here, explore our archive of past newsletters here, and subscribe here

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