Africa’s development ambitions are not held back by a lack of vision, but by the scale, cost and structure of financing available to make them a reality, said speakers at two high-level round tables organised in the framework of the 12th African Regional Forum on Sustainable Development (ARFSD-12).
These discussions, held on the themes of scaling up transformative and coordinated actions for the 2030 Agenda and Agenda 2063, and unlocking funding for the 2030 Agenda for the 2030 Agenda, will be held in the context of the Climate Resilience and Sustainable Development in Africa, brought together ministers, representatives of continental institutions, development finance officials, climate negotiators, members of civil society and international organisations.
A central message came back among the speakers: Africa’s challenge is not ambition, but implementation. This implementation, they stressed, requires affordable financing, stronger country systems, bankable project portfolios, reliable data, and a reformed global financial architecture that takes into account African realities.
ECA Executive Secretary and Moderator of the two sessions, Claver Gatete, said Africa must protect its investments in climate and development, even under the strong budgetary pressure. He stressed that reducing risks, whether currency, climate or policy-related, is essential to mobilising domestic and private capital.
Panellists noted that Africa continues to face a disproportionate cost of capital, due in part to weaknesses in the International Financial Architecture. Methodologies credit ratings, risk-weighting practices and capital adequacy frameworks were cited as limiting factors in investments in climate resilience, infrastructure and sustainable development.
The Minister for Foreign Affairs of Ethiopia and President-designate of the Thirty-second Conference of the Parties to the United Nations Framework Convention on Climate Change, Dr. Gedion Timothewos, set the strategic context by grounding the debate in African responsibility and global leadership.
“Africa’s experience in sustainable development continues to highlight a major challenge: the persistence of structural barriers, large financing gaps, Rising debt, declining investment and the high cost of capital are undermining hard-won development gains.
“Ethiopia’s COP32 presidency will systematically put climate action at the heart of sustainable development and poverty eradication. Implementation will be at the centre of our presidency, with institution-building and accelerated support for the development of national adaptation plans and long-term strategies,” he added.
Panelists highlighted that climate finance flows remain unbalanced, unpredictable and strongly mitigation-oriented, while resources in the form of Subsidies for adaptation, loss and damage management, and disaster risk reduction remain insufficient. This discrepancy, they argued, does not reflect the continent’s vulnerability and development needs.
Director and Head of Africa at Convergence Blended Finance, Aakif Merchant, presented strategic perspectives on the Seville Programme of Action to mobilise climate resilience and sustainable development finance, highlighting the role of blended finance in scaling promising instruments from the pilot phase to a wider scale.
Rwanda’s experience was also cited as an example of how climate resilience can be integrated into national development planning. The Rwandan Minister Minister of Environment, Bernadette Arakwiye, shared lessons learned from Rwanda’s transition from implementing fragmented projects to country-led national investment platforms aligned with national priorities clear measures, such as green budgeting, environmental funds, and strengthened institutional coordination, to align domestic and international climate finance with development priorities.
The Chair of the African Group of Negotiators on Climate Change, Antwi-Boasiako Amoah, stressed the need for equitable, predictable and accessible finance. adapted to the realities of African development, and not on the need for mere promises. In particular, he highlighted the importance of predictable and accessible financing, in the form of grants and concessional financing, to support adaptation and resilience, a just transition, addressing loss and damage, and green industrialisation.
The CEO of the Climate Investment Funds, Tariye Gbadegesin, highlighted the importance of large-scale climate finance platforms to accelerate the transition from stand-alone pilot projects to deployable solutions, capable of supporting green industrialisation and resilience across the continent. She noted growing evidence that investing in resilience, protecting food systems, water and energy supply systems, as well as the creation of businesses and jobs, generate economic returns.
World Meteorological Organisation Assistant Secretary-General, Thomas Asare, highlighted the role of climate risk data and early warning systems in innovation financial. He said this data can be integrated into instruments such as resilience bonds and debt-for-climate swaps to attract large-scale private investment.
Civil society also advocated for greater financial justice in the fight against climate change. Mithika Mwenda of the Pan-African Climate Justice Alliance (PACJA) said Africa must ensure transparent, equitable and accountable use of national and international resources, while stressing the need for subsidies in a context of declining funding.
“We must reaffirm common but differentiated responsibilities and countries’ respective capabilities under the Paris Agreement. Those who have contributed the most to the crisis and who have the greatest capacity must do more,” he said.
In the second panel, Zimbabwe’s Minister of Finance, Mthuli Ncube, stressed the importance of strengthening domestic resource mobilisation while protecting investments in climate and development. He noted that this had to be done in a context of limited fiscal space, increasing pressures on debt servicing, and the need for risk mitigation and financial innovation.
Senior Advisor to the Commissioner in the Department of Economic Development, Trade, Tourism, Industry and Minerals of the African Union Commission, Jean-Bertrand Azapmo, advocated for a coherent continental framework linking climate finance to green industrialisation and regional value chains under the African Continental Free Trade Area.
Coulibaly Abdoulaye, African Development Bank, highlighted the link between global reform and national capital formation. He said that, for systemic reforms, the Global Financial Architecture and sovereign credit systems are needed to reduce the cost of capital in Africa and enable the strengthening of domestic capital markets.
International Monetary Fund Executive Director, N’Sonde Regis, said more analysis and support is needed to help African countries mobilise more climate and development finance without increasing their debt vulnerability.
Olapeju Ibekwe, Sterling One Foundation, highlighted the contribution of philanthropic and non-state actors in strengthening accountability, mobilising partnerships and ensuring that financing translates into concrete development results.
At both panels, speakers warned that the fragmented and project-based implementation of climate and development finance limits its scale, coherence and coherence and impact. They called for integrated and programmatic approaches, aligned with national plans, the Sustainable Development Goals and Agenda 2063.
The discussions also highlighted weak domestic resource mobilisation and public financial management systems as major constraints. Low tax contributions, inefficiencies and limited capacity to secure resources have been identified as barriers to financing climate-resilient infrastructure and services.
Speakers also noted that many African countries do not have a sufficient number of investment-ready and bankable climate projects. Lack of capacity, technical constraints in project preparation, risk structuring and public-private partnerships, they said, continue to hamper the mobilisation of large-scale financing.
Underutilisation of regional and continental financing mechanisms were also highlighted. Speakers called for strengthening African financial institutions and increased use of innovative instruments such as green bonds, sustainability-linked bonds, debt-for-climate swaps, and Africa-friendly carbon market mechanisms.
The Forum stressed that data, transparency and accountability are key. They are fundamental to investor confidence, public confidence, efficiency and implementation and climate justice.
Participants called for enhanced continental coordination, including through the African Union. The AfCFTA was presented as a key platform to link financing climate change to green industrialisation, regional value chains, and structural transformation.
The panels agreed that ECA member states should strengthen domestic resource mobilisation and public financial management systems, put in place integrated and investment-ready portfolios for climate and sustainable development projects, and establish transparent national systems for monitoring climate finance and development.
ECA was invited to strengthen regional monitoring, policy coherence and monitoring of financial commitments, including by assisting member States in translating results the Fourth International Conference on Financing for Development and the Conferences of the Parties in order to develop coherent national financing strategies, implementation plans and measurable results.
Regional and continental institutions were called upon to strengthen financing mechanisms capable of mobilising massive amounts of public and private capital, while ensuring coherence between climate finance and integrated implementation of solutions in the energy, water, transport, industry, cities, health and resilience sectors
International financial institutions and development partners were called upon to support reforms of the International Financial Architecture and to provide financing Climate-enhanced, predictable and concessional measures, including adaptation, loss and damage reduction, and disaster risk reduction.
Both panels highlighted Africa’s ability to lead through reforms, innovation and accountability, as well as the need for supported leadership a well-functioning global financial system. They also stressed the importance of partners aligned with African priorities and financing that meets the requirements for climate resilience and sustainable development.