As part of the work of the 27th United Nations Climate Conference (COP27), Egypt and about 100 partners, including the African Development Bank (AfDB), have published a document on fair climate finance. The Sharm el-Sheikh Guide to Fair Climate Finance, launched on 11 November 2022, aims to help turn promises into action and strengthen the African continent's drive for sustainable development.
The 27th UN Climate Change Conference (COP27) is positioning itself more as the COP of climate justice. A guide on equitable climate finance was launched by the Egyptian Ministry of International Cooperation to an audience of development institutions at a high-level panel discussion at COP27, which runs until 18 November 2022 in Sharm el-Sheikh, Egypt.
The Sharm El-Sheikh Guidebook on Fair Climate Finance aims to develop an international framework for climate finance and help African countries secure more green finance, in an African context marked by budget shortfalls related to the management of the Covid-19 pandemic and soaring energy and food prices.
The guide introduces the principle that climate finance should not be a substitute for development finance, but rather should be additional to it by ensuring that the countries and regions that need it most have the right to access it. It calls on international climate actors to take into account the historical disparities in the distribution of climate finance between countries. It defines the concept of equitable financing in the structuring of international climate finance with the creation of a dedicated mechanism for its implementation.
Africa needs $1.3 trillion to $1.6 trillion
The Sharm El-Sheikh Guide to Fair Climate Finance is the result of a collaboration between the Egyptian Ministry of International Cooperation and more than 100 development partners including the African Development Bank, financial institutions and non-profit organisations. These include the International Monetary Fund, the Rockefeller Foundation, the World Economic Forum, the Climate Investment Funds and the Citi Banking Group.
“Given the devastating effects of climate change, the issue of financing has become central. And with the exacerbation of the impacts of the Covid-19 pandemic and the Russian-Ukrainian conflict, developing countries and emerging economies are more than ever in need of dedicated financing, which is essential for further climate action,” says Rania Al-Mashat, Egypt’s Minister of International Cooperation.
Akinwumi Adesina, President of the African Development Bank Group, said that “the greatest threat to humanity today is climate change. It places a heavy burden on the world’s poorest and most vulnerable. It is distorting landscapes, ruining people and threatening the lives of billions of people every day.
In its African Economic Outlook 2022 report, the AfDB says Africa needs $1.3 trillion to $1.6 trillion in financing between 2022 and 2030 to effectively address climate change. Of this amount, US$715 billion is needed for mitigation, US$1.3 billion for technical and technological needs, US$289-440 billion for loss and damage, while US$259-407 billion will be needed to finance adaptation to climate change. On this last point, East Africa has the highest estimated cost of adaptation, at $143 billion.