By Africa Links 24
Published on 2024-04-03 11:19:04
The transition to green energy, necessitated by climate change, presents an opportunity for African countries to pursue a new course of industrialization that has eluded many since independence. The continent is rich in critical minerals required for powering cars, homes, and industries. Additionally, Africa boasts vast potential in renewable energy that can drive its own development.
These discussions took center stage at the United Nations’ Economic Commission for Africa’s 56th Conference of Ministers of Finance and Economic Planning in Victoria Falls, Zimbabwe. The summit, held under the theme “Financing the Transition to Inclusive Green Economies in Africa: Imperatives, Opportunities, and Policy Options,” aimed to address the challenges and opportunities presented by climate change.
Dr. E.D. Mnangagwa, President of Zimbabwe, highlighted Africa’s disproportionate burden in combating climate change despite its minimal contribution to emissions. The lack of necessary investments hampers the continent’s ability to address the crisis and meet its Nationally Determined Contributions.
The need for innovative finance was emphasized by President Mnangagwa, urging African leaders to explore alternative resource mobilization initiatives to bridge the financing gap. He emphasized the importance of promoting green industrial development, attracting investment in green sectors, facilitating technology transfer, and fostering regional cooperation.
Despite the potential benefits of the energy transition, Africa faces challenges in securing the required investments. Dr. Hanan Morsy, deputy executive secretary of the ECA, highlighted the continent’s need for $2.8 trillion to finance its emissions reduction goals, while only receiving about $300 billion. She stressed the importance of scaling up concessional finance and enhancing debt resolution frameworks to address these challenges.
Addressing illicit financial outflows through tax avoidance could also provide additional funds for the green transition. African countries were urged to support negotiators at the Framework Convention on International Tax Cooperation to prevent tax avoidance, especially by large multinationals. Enhancing coordination efforts and stakeholder engagement were recommended to mobilize support and negotiate uniform tax rules.
Antonio Pedro, deputy executive secretary of the ECA, called for Africa to move away from resource extractivism and transition towards sustainable economic practices. He advocated for localizing supply chains and promoting intra-African trade through initiatives like the African Continental Free Trade Area.
Advancements in artificial intelligence were highlighted as offering opportunities for Africa to boost efficiencies, achieve social development milestones, and improve quality of life. James Manyika, senior vice-president at Google, emphasized the need to equip the continent’s workforce with the necessary skills to navigate the shifts induced by AI.
The ECA is providing support to African countries in formulating policies to address these challenges. Initiatives like the Africa Climate Resilient Investment Facility and the promotion of climate-resilient investments aim to foster sustainable development on the continent.
In conclusion, Claver Gatete, the UN under secretary-general and executive secretary of the ECA, emphasized the need for a fairer global financial and political architecture that acknowledges the increased power of developing nations. With better domestic resource mobilization, private sector engagement, and regional collaboration, Africa can transform and lead in the transition to a greener economy.
The future belongs to Africa, and with deliberate action and unity of purpose, the continent can overcome challenges and seize opportunities for sustainable development.
