Heads of state from across Africa concluded their first-ever climate summit in Nairobi, Kenya, by issuing a declaration calling for a restructuring of the way wealthier nations engage with the continent. The declaration emphasized that Africa has the potential to lead in clean energy and environmental stewardship. However, the statement stressed that in order for this to happen, industrialized countries responsible for climate change must provide financing through investments, rather than just aid during disasters. Financing is a major issue dividing rich and poor nations in the fight against climate change.
The lack of financing has been a major point of contention as the world tries to reduce carbon dioxide emissions. It will also be a significant topic at the upcoming United Nations climate summit in Dubai. At the Nairobi summit, investors announced around $23 billion for projects including solar microgrids, carbon markets, and reforestation. However, it is unclear how much of this money represents commitments versus intentions.
Kenya’s President William Ruto highlighted Africa’s renewable energy potential and the need for sustainable development. He emphasized the importance of going green before industrializing, as well as the lack of electricity access for millions of people in Africa. Historically, multinational lending institutions have considered many African countries too risky for investments in renewable energy due to concerns about economic mismanagement and conflict. The Nairobi Declaration aims to serve as Africa’s common position ahead of the UN climate talks in Dubai.
The summit drew tens of thousands of delegates and potential investors, particularly from Western countries. These investors were urged to back their promises with financial commitments. Despite previous pledges to provide over $100 billion in climate-related financing to least developed countries, wealthy nations have fallen short of these targets while investing trillions of dollars in renewable energy domestically. The tension surrounding financing pledges was evident throughout the summit.
While some African countries rely heavily on renewable energy, questions were raised about the conference’s impact on the economic crisis facing Kenya. The country’s currency has significantly devalued against the dollar, and taxes have increased, affecting the cost of living. Leaders from Nigeria, South Africa, Ethiopia, Egypt, among others, did not attend the summit, undermining its message of unity.
The attendees’ request to the world was for concessional finance, which comprises loans at below-market interest rates and more lenient repayment timelines. The World Bank and International Monetary Fund could provide substantial concessional finance if they follow through on promised reforms. Recent leadership changes at the World Bank may accelerate internal reforms to support climate-positive investments in less developed countries.
There is hope that multilateral development banks will become more willing to take on risks associated with climate investments. Momentum is building to dispel banks’ previous cautiousness and increase their support for climate finance. The Nairobi summit serves as a catalyst for these developments.