PREVIEW
Rich countries are under pressure to step up pledges on climate finance and flexibility on energy policy
African governments say there is growing unease about the weight given to environmental conditions on the continent in preparatory talks for the COP26 climate summit opening on 31 October. Extreme weather events over the past three years, they say, have reinforced data showing that Africa is the continent worst hit by global warming while contributing the least to it.
As the summiteers try to produce a new accord to cut emissions by outlawing fossil fuel production, officials from developing countries want more attention to be paid to access to energy. Just over 55% of people in Africa have access to electricity, although in Kenya it's over 85% and in South Africa over 94%. The bulk of that power is generated by oil and coal (AC Vol 62 No 20, Placing faith in future coal).
Many African governments are alarmed at efforts by Western officials and banks to choke off international financing for coal, oil and gas. Last week Reuters reported that European directors had sent a memo to the World Bank calling for all finance for fossil fuel projects to be ended.
Among the African presidents due to attend COP26 in Glasgow are Nigeria's Muhammadu Buhari, Ghana's Nana Addo Akufo-Addo and Congo-Kinshasa's Félix Tshisekedi.
South Africa's Cyril Ramaphosa says he will not attend due to local elections due on the following day, but his government will send one of the continent's biggest delegations. Its focus will be on managing and financing a transition from coal to renewable energy.
Ahead of the opening of the summit, last-minute negotiations are intensifying over contributions to the US$100 billion a year fund to help developing economies mitigate and adapt to climate change. G20 governments, due to meet in Rome on 30 October, are arguing both over contributions to the fund and how the resources are allocated globally.
To compensate for laggardly contributors such as Australia, Canada, Italy, Britain and the United States, other countries such as Spain, Norway and Sweden are expected to step up their contributions ahead of the COP26 summit.
Britain, reckoned by the Overseas Development Institute to have paid around half of its share of contributions to the fund, has announced it will boost payments by $10bn over the next four years. That pledge has triggered further arguments in Whitehall about the source of those funds. The US administration has also pledged a similar 'catch-up' contribution, after Donald Trump's administration pulled the country out of the UN Climate accord in 2016.
According to the Organisation for Economic Cooperation and Development, only $79bn of the $100bn was raised in 2020. The Climate Finance Delivery Plan published this week by OECD countries says that it will take until 2023 to meet the $100bn target.
African countries want a new system to track funding from wealthy nations that are failing to meet the $100bn target, said Tanguy Gahouma-Bekale, chair of the African Group of Negotiators at COP26.
For the first time, this year's Financial Markets Index rankings, compiled by the Official Monetary and Financial Institutions Forum and Absa Africa, have incorporated sustainability criteria reflecting efforts to attract more investment for energy transition projects.
So far, only 26% of current climate finance is going to Africa, compared to 43% to Asian states. But more African economies are looking to raise finance for sustainable energy projects as market conditions change.
David Marsh, chairman of OMFIF consultants, says there is a growing awareness about the value of sustainable finance and deeper financial markets as a buffer against economic fluctuations.
For now, only a handful of states, led by Kenya and Morocco, are offering much to international investors looking to commit to the region. They are also among the group of nine countries who have introduced green bonds alongside other sustainable financial products such as ethical securities (AC Dispatches 21/09/21, Climate, pandemic and conflicts to dominate meetings in New York & 19/10/21, Scraping the barrel: why Shellexit doesn't mean the end of oil in Nigeria).
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