Green Economic Growth for Africa

Linking the MDGs and Climate Change at Cancún

Two of the challenges that will define this century are overcoming world poverty and managing climate change. The interplay between the two will be one of the critical factors in progress towards the Millennium Development Goals (MDGs) in Africa. Climate change has the potential to undermine recent gains in reducing extreme poverty, while the cost of reaching the MDGs rises by 40% when climate proofing is taken into account.[1] Our approach to mitigating and adapting to climate change must therefore be ambitious, adequately funded, but also sensitive to Africa’s legitimate desire for economic development. Cancún can be a turning point at which countries signal a shift to more sustainable and equitable economic development and poverty alleviation – and in which the African Lion economies have a central role to play.

Therefore at Cancún ONE is calling for progress on: effective and sufficient climate finance for Africa, and support for ‘green growth’ in Africa.

Effective and Sufficient Climate Finance for Africa

The COP negotiations in Cancún are a key opportunity to make progress on climate finance for the poorest countries in the world – which are bearing the brunt of a crisis they did little to cause.  Fast-track finance commitments made in Copenhagen must be met in full to kick-start crucial programmes in developing countries and restore trust to the process.  The UN Advisory Group on Climate Finance (AGF) has presented new and innovative ways for how the world can reach the Copenhagen Accord finance targets for developing countries by 2020. National governments and the UNFCCC should ensure these proposals become a reality. The AGF report must be the start of the process of drawing in experts from all fields to meet the financing challenges – not the end.

African countries will need significant resources to adapt to the development challenges that come with climate change. It is estimated by the Africa Progress Panel that the external financing requirement for Africa to reach the MDGs rises by 40% when climate proofing is taken into account. Keeping overseas development assistance levels constant and expecting them to cover new adaptation costs will therefore mean damaging cuts to other programmes, including in health and education.  In order to ensure that climate finance is spent most effectively it should follow the principles of the Paris Declaration and the Accra Agenda for Action and be coordinated with other development assistance efforts.  ONE believes a successful summit will therefore realise the following finance outcomes:

• All countries contributing to fast-track finance apply the TRACK principles to their payments: Transparent, Results-oriented, Additional, any Conditionalities are clear, and the commitments are monitored to know whether they are being Kept.
• An overarching Global Green Fund is established to distribute this climate finance with clear mechanisms for fair representation of African countries in the management and disbursement of resources. This includes allocation of adaptation finance according to need, with at least 30% going to Africa-based projects.
• The outcomes of the AGF’s report are used to plan medium-term revenue sourcing for the Global Green Fund.
• Agreement on coordinating adaptation finance with agricultural development and food security initiatives in rural areas and programming according to aid effectiveness principles.
• A clearly articulated commitment to assist African governments both financially and to increase their domestic climate change knowledge and capacity to effectively spend donor and national climate finance.

The Africa ‘Green Growth’ Opportunity

Africa has the chance to lead the world towards an alternative form of green economic development, a process that is compatible with both tackling climate change and fighting poverty. Energy poverty in the form of limited access to power remains one of the biggest impediments to pro-poor African economic growth. Yet, Africa possesses huge potential in the field of renewable energy. If this is sustainably developed, there will be gains in employment and electricity coverage, while reliance on expensive oil imports will decrease, freeing up government budgets to invest in the development of other sectors.

For Africa to lead the world in green growth, support is required from beyond the UN climate change process. The Korean G20 gave backing for ‘country-led green growth policies’ and the G8 in Canada this year stressed the opportunities for job creation in renewable energy. French leadership of these bodies in 2011 should prioritise translating encouraging words into concrete actions. Similarly the newly established UN High-Level Panel on Global Sustainability, co-chaired by South Africa and Finland, and the South African chairmanship of the COP in 2011 can ensure that progress made on this green growth concept in Mexico will gain momentum next year.

There are, however, steps that ONE believes the COP16 and COP nations should take in the short-term to advance this sustainable, equitable, low-carbon growth vision:

• COP16 agrees rapid scaling up of renewable energy technology transfer to Africa.
• COP nations agree to support African governments to establish fundable low-carbon growth plans which complement National Adaptation Programmes of Action and Nationally Appropriate Mitigation Actions. (e.g. the US Global Climate Change Initiative as articulated in their MDG strategy)
• African Governments’ low-carbon growth plans should include clear measureable actions such as: number of people lifted out of energy poverty, and, number of local jobs created.
• COP nations support the African Development Bank (ADB) to establish a ‘green growth window’ with clear financing scenarios. This can be done through the African Green Fund proposed by the ADB in Cancún – which should prioritise green growth alongside mitigation and adaptation priorities.
• COP nations and/or international bodies set up loan guarantee schemes to encourage investment in African renewable energy projects that do not undermine food security (the International Finance Corporation’s China Utility Energy Efficiency Programme provides a successful model for this).
• Ensure any reform of the Clean Development Mechanism provides additional focus and support on African renewables generation.
• COP16 reiterates the value of Africa’s forests in both abating climate change and as a source of economic opportunity for rural populations, and accelerates progress on the REDD+ framework.

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