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Africa’s recovery depends on green investments.

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Africa is ready for the green revolution. Image credit: Wikimedia Commons

23 April 2021Africa’s huge market offers immense opportunities for investors. However, it is imperative that development and investments ensure sustainability, improve the plight of Africa’s people, and address critical issues like climate change and the environment. Africa’s recovery, now, more than ever, depends on green investments.    

These sentiments were reflected in the African Development Bank’s current President Dr Akinwumi A. Adesina’s video address at the European Union-Africa Green Investment Forum to a global audience recently when he reminded them of the continent’s vast opportunities for green growth.

Africa is a huge market offering incredible opportunities. The recovery pathway offers enormous opportunities. Recovery must be green and build climate resilience. Recovery must boost green investments,” Adesina said in his keynote address.

The hybrid forum was convened by Portugal and the European Investment Bank to mobilise private and public capital towards the green transition in Africa. The high-level event brought together leading government and business figures, international and development financial institutions, civil society, and academia.

Adesina identified energy, agriculture, and infrastructure as key areas of investment potential for a post-Covid-19 recovery in Africa. With abundant solar, wind, hydro and geothermal energy resources, Africa’s energy transition alone presents a USD100-billion per year investment opportunity. Agriculture potentially offers massive investments in climate-smart crops to build more resilient food systems. And climate-resilient infrastructure offers investment potential of between USD130-billion and USD170-billion.

Speakers emphasised the need to build back greener collectively. Several congratulated the United States, after President Joe Biden committed to cut carbon emissions by 50-52% below 2005 levels by the year 2030.

“We need to bring everyone on board,” African Union Commissioner Josefa Sako said. She called for a just transition that recognised the historical responsibility of the developed world for climate change. She warned that measures taken should not push vulnerable populations into greater poverty.

According to European Investment Bank President Werner Hoyer the partnerships forged in addressing the Covid-19 crisis must now be applied to climate change. “Africa may be the continent that is most vulnerable to the immediate effects of climate change, but it is responsible for some of the lowest greenhouse gas emissions per head. This is also the continent where mistakes made elsewhere can be avoided. Africa can invest in innovative technologies and make the right choices for a sustainable and inclusive future,” Hoyer said.

In a recorded message during the opening session, António Guterres, Secretary General of the United Nations, said the gathering was an opportunity to strengthen partnerships and boost investment in Africa for the benefit of all.

“I see agendas converging around financing a green transition and greater resilience. African countries are rapidly scaling up renewables, particularly solar and wind power,” Guterres said.

While climate change is a huge challenge for Africa, Adesina urged investors to seize on the opportunities it presents, which would be worth USD3-trillion by 2030.

The African Development Bank is in the vanguard of investment in climate adaptation, he said, but over 70% of the financing needed will need to come from the private sector to complement public investments.

“The private sector, especially small and medium-sized enterprises, is critical in mitigating climate change and implementing adaptation methods. This calls for innovative approaches to attract and steer financial flows toward low carbon and climate resilient development,” Adesina said.

A greener Africa must also focus on the circular economy, in which waste can be recycled and turned into wealth. For example, a new plastic recycling plant in Ghana has already created 2300 green jobs, while converting food waste into organic fertilisers will increase the circularity of the food systems.

Commending the European Commission’s External Investment Plan, Adesina said the Bank looked forward to building a strong partnership with the Commission to deliver more in the context of the new EU strategy with Africa.

“Africa is already green. Africa just needs to get greener. What is needed now is more euros to back Africa’s green growth. Think about the tremendous green investment opportunities available today and many more that will emerge into the future. Think differently, think Africa,” he concluded.

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