Rwanda and other African countries are pushing for a fund that could compensate developing countries for “loss and damage” caused by climate change, according to Faustin Munyazikwiye, Rwandan climate negotiator, who is Deputy Director General of Rwanda Environment Management Authority (REMA). “Loss and damage” refers to the harm and destruction that happens when people and places are not prepared for climate-driven impacts, and have not or cannot adjust the way they live to protect themselves from longer-term shifts. The developing countries want to be compensated for this harm caused by the emissions from the developed ones. The fund that was proposed by developing countries to support their efforts to tackle climate change was rejected by big powers, which highly contribute to global warming, at the 26th UN climate conference (COP26) that took place, last year, in Glasgow. This facility would be funding climate change adaptation, mitigation, and loss and damage caused. The ‘loss and damage compensation’ fund, which Rwanda is also pushing, will be a hot topic and developing countries’ priorities at COP27 according to environmental experts. COP27 is the first COP to be held in Africa after adopting the Paris agreement in 2015. “We need funds for key priorities we are involved in. COP27 is expected to decide on key pending issues under climate change negotiations,” he said, citing “loss and damage” compensation mechanism. The international Mechanism for Loss and Damage associated with Climate Change Impacts was established at the COP19 UN climate conference in November 2013 to address losses and damage in developing countries. The Mechanism’s role was recognised in 2015 in Article 8 of the Paris Agreement and was reviewed in 2019 at COP25, during which developing countries demanded that it be enhanced and strengthened, to include additional finance from developed countries. However, consensus was not reached on developed countries’ obligations. “We need a clear finance mechanism for loss and damage compensation because Africa is most affected yet it contributes less to carbon emissions,” Munyazikwiye said. Falling short of climate finance target According to Munyazikwiye , climate finance is Rwanda’s key priority at COP27. “The first priority is access to climate finance. It is the priority of Africa including Rwanda. Access to climate finance means a lot. Since 2009, in Copenhagen, the world pledged to avail $100 billion every year by 2020 to support developing countries to cope with climate change. However, until today, that pledge has never been met,” he said. Developed countries provided and mobilised US$ 83.3 billion in 2020 in climate finance, an increase on previous years but still a long way from the US$ 100 billion climate finance goal set in 2009 and they are falling $16.7 billion short of the target according to the Organisation for Economic Co-operation and Development (OECD). Now the deadline to reach the $100 billion pledge has been pushed to 2025. “We need strategies to meet the goal,” he said. Rwanda needs more access to climate finance considering that it loses Rwf200 billion annually due to climate change effects. Climate finance for Africa needs to grow nine times Climate finance for Africa needs to grow nine times from $30 billion to $277 billion to meet 2030 climate goal, a new study indicates. The Research by Climate Policy Initiative (CPI) finds that total annual climate finance flows in Africa for 2020, domestic and international, was only $30 billion, just 11 per cent of the $277 billion needed annually. While the financing gap is significant, Africa’s rapid urbanisation, expanding infrastructure, and energy-access needs offer significant investment opportunities. The climate finance in Africa is a first-of-its-kind analysis to map climate finance flows in Africa by region, sector, and source. It shows that private sector financing remains too low as it contributed only 14 per cent (USD 4.2 billion) of total climate finance in Africa, much lower than in other regions like South Asia (37 per cent), East Asia and Pacific (39 per cent), and Latin America & Caribbean (49 per cent). The study estimates that Africa requires $277 billion dollars annually to implement its climate actions known as Nationally Determined Contributions (NDCs) and meet its 2030 climate goals. However, the most recent data show annual climate finance stands at only $30 billion. This gap is likely even greater as countries often underestimate their climate finance targets, especially in relation to adaptation, due to data and methodological problems in costing their NDCs. Investment gaps vary between countries, but all regions receive significantly less finance than they need. The Southern African region bears the largest financing gap in absolute terms. This is mainly attributed to high climate finance needs of South Africa alone, estimated at USD 107 billion, combined with one of the lowest regional levels of climate investment. Climate finance is concentrated with 10 countries accounting for more than 50 per cent of Africa’s climate finance. These include Egypt, Morocco, Nigeria, Kenya, Ethiopia and South Africa. Africa strikes a better balance between adaptation and mitigation than other regions, the study shows. Mitigation accounted for 49 per cent (USD 14.6 billion) of climate finance flows in Africa, followed by 39 per cent (USD 11.4 billion) towards adaptation, and 12 per cent (USD 3.5 billion) to dual benefits. According to the study, Africa will need around USD 133 billion annually in clean energy investment to meet its energy and climate goals between 2026 and 2030. However, annual investment in renewable energy — arguably the most attractive sector for commercial investors — stands at a mere USD 9.4 billion.
