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TLDR: Africa to Be $2.5 Trillion Short of Climate Finance by 2030, UN Says
According to a UN official, Africa needs $2.5 trillion by 2030 to cope with climate change, but is currently only attracting 2% of global investments in clean energy. Despite contributing the least to greenhouse gas emissions, African countries are experiencing significant impacts of climate change, with each African producing only 1.04 tonnes of carbon dioxide emissions in 2021. Heavy public debt and high interest rates on debt servicing are further exacerbating the financial challenges faced by African nations.
Main Article:
Africa is facing a significant shortfall of $2.5 trillion in climate finance by 2030, with only 2% of global investments in clean energy being directed towards the continent. Despite having low emissions compared to other regions, African countries are experiencing substantial impacts of climate change, with each African producing just over 1 tonne of carbon dioxide emissions in 2021, less than a quarter of the global average. The continent is also witnessing an average rate of warming of 0.3 degrees Celsius per decade, higher than the global average of 0.2 degrees.
The financial challenges are further compounded by heavy public debt, with African countries paying higher interest rates on debt servicing than other regions. This results in countries spending more on servicing debt rather than on climate action. Many speakers at the UNECA conference have called for reforms in the global financial architecture, citing unfair risk perceptions and credit ratings that limit Africa’s borrowing options. The subjectivity of credit ratings alone is estimated to cost the continent up to $74.5 billion, according to data from the UN Development Program.
In conclusion, the urgent need for increased climate finance in Africa is highlighted, along with the disparities in global investments and the challenges faced due to heavy public debt and high debt servicing costs. Reforms in the global financial system are deemed necessary to address these issues and support African nations in tackling climate change effectively.
