By Sévérin EKPE, Monroe Dikiny
Introduction
The recently concluded COP29, held in Baku, Azerbaijan, from November 11 to 22, brought together nearly 200 countries to engage in discussions focused on climate finance.
The conference served as a platform for international climate diplomacy, facilitating negotiations on key agreements regarding finance and carbon markets. However, COP29 highlighted the ongoing divide between developed and developing nations in terms of climate finance. While some progress was made, significant gaps remain that leave many developing countries feeling dissatisfied with the outcomes. For Africa, the results of the conference both present opportunities and pose challenges in harnessing climate finance to tackle urgent climate issues and to effectively implement their Nationally Determined Contributions (NDCs).
As part of the ACTS Sustainability Fellowship Programme 2024, this blog provides a detailed overview of the key outcomes of COP29 and their significance for Africa. By highlighting these outcomes, we aim to offer policymakers, climate practitioners, and stakeholders a clear understanding of the evolving climate finance landscape and its potential impact on Africa's sustainability journey. Through this resource, we hope to foster a deeper appreciation of the interconnectedness of global climate actions and Africa's sustainability priorities. By encouraging collaboration and knowledge-sharing, we aim to inspire collective efforts toward achieving equitable and impactful sustainability goals. Ultimately, this blog serves as a vital tool for advancing Africa's role in the global climate finance dialogue, providing the information needed to drive progress and champion transformative policies.
Key Highlights
Wins: Progress in climate finance commitments
A notable achievement of COP29 was the scaling up of global climate finance commitments. Developed nations pledged to increase the annual climate finance goal from $100 billion to $300 billion by 2035. This step, while incremental, is a recognition of the financial needs of developing nations to combat climate change and adapt to its impacts. Additionally, the operationalization of Article 6 mechanisms under the Paris Agreement marked a significant milestone, providing a framework for carbon trading and collaboration among nations to achieve emission reduction targets. For Africa, these mechanisms represent an opportunity to attract investments for projects that align with its Nationally Determined Contributions (NDCs).
Disappointments: Insufficient ambition and equity concerns
Despite the increased financial commitment, developing nations expressed dissatisfaction with the scale of funding, arguing that $300 billion annually falls short of what is needed to address the climate crisis effectively. A study found that developing countries need $1 Trillion a year in climate finance by 2030. Representatives from developing countries highlighted the urgency of their situations, emphasizing that delays in substantial funding could result in severe climate impacts, particularly for vulnerable regions like Africa. Moreover, equity concerns remain, as many African nations struggle to access these funds due to bureaucratic hurdles, limited institutional capacity, and a lack of transparency in disbursement mechanisms.
Challenges for African countries
Several barriers still hinder Africa’s participation in carbon markets and climate finance mechanisms. Capacity gaps in designing, implementing, and monitoring projects continue to limit the continent’s ability to engage in these markets fully. Additionally, only five countries, including Kenya, Zimbabwe, DRC, Ethiopia, and Uganda, dominate credit issuance (65%) on the continent, according to a report from AUDA-NEPAD (2024). This concentration of carbon market activities in a few countries leaves other nations underrepresented. Furthermore, the fluctuating prices of carbon credits and the risk of inequitable benefit-sharing exacerbate these challenges, making it difficult for Africa to maximize the potential of climate finance.
The way forward for Africa
To address these challenges, African countries need to adopt a strategic approach to leverage climate finance effectively. This includes strengthening governance and institutional frameworks to ensure transparency and build investor confidence. In addition, regional collaborations, such as the Africa Carbon Market Initiative (ACMI), the Alliances on Carbon Markets and Climate Finance in East and West Africa, and initiatives like the ECOWAS Carbon Market Project, should be expanded to foster knowledge sharing and collective bargaining power. At the lower level, capacity-building for local communities and smallholder farmers can enable them to benefit directly from climate finance projects. Lastly, carbon finance mechanisms should be aligned with Sustainable Development Goals (SDGs) to ensure that climate action contributes to broader development objectives.
Conclusion
COP29 underscored both progress and ongoing inequities in global climate finance, particularly impacting Africa. The outcomes reaffirm the critical need for proactive engagement in climate negotiations and emphasize the importance of strengthening internal capacities to access and effectively utilize available funds. The ACTS Sustainability Fellowship Programme serves as a vital knowledge hub for researchers, providing essential knowledge dissemination and capacity-building initiatives. These efforts are crucial in equipping African stakeholders to navigate the complexities of climate finance.
By addressing the challenges and leveraging the unique opportunities available, Africa can transform climate finance into a powerful tool for sustainable development and resilience. This approach not only aims to foster a more equitable climate finance landscape but also paves the way for a more climate-secure future for the continent. Through strategic collaboration and enhanced capacity, African nations can position themselves to better respond to climate challenges, ensuring that climate finance contributes meaningfully to sustainable development goals.
References
- AUDA-NEPAD. (2024). Carbon Markets in Africa: A Comprehensive Study. https://www.nepad.org/file-download/download/public/148090
- East Africa Alliance on Carbon Markets and Climate Finance. (n.d.). About us. https://easternafricaalliance.org/about-us/
- United Nations Framework Convention on Climate Change (UNFCCC). (2024, November 24). COP29 UN Climate Conference Agrees to Triple Finance to Developing Countries, Protecting Lives and Livelihoods [Announcement]. https://unfccc.int/news/cop29-un-climate-conference-agrees-to-triple-finance-to-developing-countries-protecting-lives-and
- United Nations Framework Convention on Climate Change. (n.d.). West African Alliance on Carbon Markets and Climate Finance [PDF]. https://unfccc.int/sites/default/files/resource/WAA%20PRESENTATION.pdf
