UN Climate Change High Level Champion for Egypt Mahmoud Mohieldin
The private sector contributes in the climate finance in Africa with no more than 3 percent out of $11.4 billion, Mohieldin said during his virtual participation in a session organized by the World Economic Forum under the title "The Road to the Climate Summit: How to Close the Climate Finance Gap".
Africa, where 600 million people lack energy and need sufficient funding, currently receives approximately $29.5 billion annually, of which $14.6 billion is for mitigation and about $11.4 billion is for adaptation.
The amount allocated for climate adaptation for Africa by 2030 should to be increased six times to reach $62 billion, up from the current $11.4 billion, Mohieldin said in previous remarks, adding that Africa needs $2.8 trillion between 2020 and 2030, an average of $277 billion annually.
Adaptation funds are provided by the Adaptation Fund Board, a global body originally set up in 2001 by the United Nations Framework Convention on Climate Change (UNFCCC) to provide financial aid to developing countries to adapt to the negative effects of climate change.
Mohieldin said deepening the contribution of the private sector comes mainly from institutional investors and charitable institutions.
Accordingly, he stressed the need to exert more efforts in the file of adaptation and losses and damages by strengthening the participation of the private sector and cooperation with the insurance sector.
Mohieldin, on the other hand, noted the importance of supporting risk management through multilateral development banks, engaging all stakeholders, and supporting innovation related to climate and nature, on the basis of debt swaps.
The climate champion said supporting adaptation measures provides many promising opportunities for investment in the agricultural sector, food security issues, and water resource management, and, as a result, contributes to creating job opportunities.
“The issue is not just about insufficient funding, but rather this funding is also inefficient given the length of time that such funding reaches emerging markets and developing economies,” he assured.
Mohieldin also warned against relying on borrowing, especially with the high-risk environment, in addition to fluctuations in inflation and the exchange rate.
The session was attended by Jennifer Morris, Executive Director of the Nature Conservancy and Marisa Drew, Head of Sustainability at Standard Chartered Bank.
In the coming days, eyes turn to the Egyptian Red Sea resort of Sharm El-Sheik where the UN climate change conference (COP27) will take place from 6-18 November.
COP27 gives high priority to the actual implementation of climate action to help facilitate the transition to green energy in order to reduce harmful greenhouse gas emissions and adapt to climate change as per the Paris Agreement.
The Paris Agreement – adopted at COP21 and signed by over 190 states, including Egypt – came into effect in 2016 with the aim of limiting the rise in temperatures to 1.5 degrees Celsius.