The African Development Bank (AfDB) is setting up a $1.5 billion green finance facility to help meet surging demand for money to develop clean energy and defend infrastructure against floods, storms and rising seas exacerbated by global warming.
The AfDB plans to partner with commercial banks and governments to fund projects, the AfDB’s principal climate officer, Audrey-Cynthia Yamadjako, told Bloomberg in an interview.
“It’s a way to develop a sustainable pipeline of well-structured projects,” she said.
The fund aims to encourage investment in climate finance needs on the continent, which aren’t being met by cash-strapped African governments or by developed nations.
The Nationally Determined Contributions of African nations plans presented to the United Nations charting national responses to global warming — would need $2.8 trillion in funding by 2030, according to an AfDB presentation.
The lender aims to raise $100 million by the end of 2023 and the full $1.5 billion by the end of 2025, a small proportion of the financing the continent will need to adapt to a warming planet.
Initial funding will partly come from the Climate Investment Funds and other partners, Yamadjako said.
The issue of climate financing is expected to take centre stage at next month’s UN climate summit as developing nations demand more support from industrialized countries that prospered for nearly two centuries at the expense of the planet.
The AfDB recently said the continent was losing up to 15 per cent of its Gross Domestic Product (GDP) per capita growth to climate change and related impacts, urging developed nations to fulfil their commitment by bridging the “climate financing gap”.
To close the gap, the AfDB said about $1.6 trillion was needed between 2022 and 2030 to meet the continent’s Nationally Determined Contributions (NDCs), with the climate finance gap now increasing.
The bank urged the global community to meet its $100 billion commitment to help developing countries mitigate the impacts of climate change.
At a United Nations climate summit in Copenhagen in 2009 (COP 15), rich nations promised to channel $100 billion annually to developing countries by 2020 to help them adapt to climate change and mitigate further rises in temperature. But that pledge has only ever been partially met.
