1 September 2023 “Africa’s solutions for the world”

Guest article by Development Minister Svenja Schulze in the French-language news magazine Jeune Afrique on the occasion of the Africa Climate Summit.

The original French version can be found here (External link).

The countries of Africa are a key part of finding a solution to the global climate crisis. The first Africa Climate Summit is showing the international community the direction that must be taken in order for our planet to have a future.

The richest ten per cent of the world’s people are responsible for causing almost half of all greenhouse gas emissions. Tackling the climate crisis is proving to be an uphill task, especially in wealthy countries. It is therefore quite understandable that African climate activists like Elizabeth Wathuti are starting to ask if people in industrialised countries still haven’t realised how serious the situation has become. For Africans there is no need to ask whether they realise how serious the situation has become – many of them, especially poorer people, are feeling it directly.

Adapting to climate change – and accelerating change in economies and societies

Overall, African countries have caused just six per cent of all CO₂ emissions; but the impacts of climate change on the continent are especially grave. Supporting African countries’ efforts to adapt to those impacts is therefore becoming increasingly important. When the international community gathers in Nairobi in early September for the first Africa Climate Summit, however, the discussion will go much further: it will be about Africa’s role as an engine for a global transition to climate neutrality.

Africa as the engine for a just transition

The ambitious programme for the Africa Climate Summit makes this evident. Most African countries are facing the enormous challenge of supplying their growing populations with energy. At the same time, they need to decarbonise their economies and adapt to the growing impacts of climate change. However, the transition to climate neutrality is also a huge opportunity for many African countries. By developing sustainable industries and renewable energies, they can create decent jobs and boost their economies whilst making them environmentally friendly and socially just. That way they will be driving the global just transition forward. Joseph Ng’ang’a, the CEO of the Africa Climate Summit, has said: “Africa has the resources and the world has the money and the technology.”

Africa is showing the way – it’s time for the world to follow suit

William Ruto, the President of Kenya and host of the first Africa Climate Summit, has said that Africa can contribute its potential in order to make headway on finding a solution to the climate crisis. Germany, Europe and the international community should support this initiative. That includes finally providing the 100 billion US dollars a year in international climate finance that the industrialised countries promised the Global South. Germany is on the right track to reach its target here: in 2022, 6.3 billion euros from the German budget already flowed into international climate finance. Germany is therefore contributing its share. There is however more to it than calculating contributions. We need changes in the international financial architecture. The Africa Climate Summit has rightly placed that topic high on the agenda. I would therefore like to put forward three concrete demands in connection with climate finance for discussion at the summit:

1) A better and bigger bank: making the World Bank into a true transformation bank

So that more capital can be used to invest in tackling global challenges like the climate crisis, I am calling for a fundamental reform of the World Bank. The World Bank needs to direct its country-based business model more towards the goal of finding better ways to protect the climate, health and other public goods across national borders. That will benefit everyone. This also means that climate action and poverty reduction should not be played off against one another. On the contrary: as a transformation bank, the World Bank should help economies and societies become more socially just and more environmentally oriented. For example, by investing in creating good jobs in climate-neutral sectors of the economy.

2) Debt swaps: recognising the value of the climate

The climate issue is also a debt issue, because unfortunately it is still too often the case that “debt kills climate”. It is a dilemma that is also experienced by many African countries. They want to invest in climate action and in making their economies environmentally sustainable, but they cannot because of their debts. I am therefore a strong advocate of debt conversion that takes climate action into account, so-called debt-for-climate swaps or debt-for-nature swaps. The idea is that a country which is indebted but not over-indebted swaps part of its debt burden against a commitment to invest an equal amount in social and environmental transition. The country that converts its debts benefits just as much as the global community.

3) A fair share: financing climate action through globally just taxation

Taxation is the most obvious and the most effective instrument for funding spending that benefits everyone. The costs of climate action are that kind of spending. Which means that everyone should contribute their fair share. That includes higher taxes for the rich. And that means making sure that multinational companies pay taxes in the countries where they do business. In many countries, especially in the Global South, multinational companies so far pay little in the way of taxes, although they benefit from public infrastructure, resources and the local workforce. That is why I am lobbying for fair international tax negotiations, with the countries of the Global South having an equal place at the table. As I have often heard from civil society: “If you are not at the table, you are on the menu.” If international taxation rights are fairly distributed, then many African countries will also be able to increase their tax revenues accordingly – making funds available for climate action.

Germany’s task: listening and learning

For me, these thoughts about climate finance are just the start. At the Africa Climate Summit in Nairobi the German delegates will be focused on one task above all others: listening and learning. In order to find motivation and inspiration. For our own work, for the work to be done in international bodies and forums, and for the international climate conference COP28 in Dubai in December. Because the African perspective will play a major role in shaping the negotiations in Dubai.

Svenja Schulze is the German Federal Minister for Economic Cooperation and Development. In her Ministry’s Africa Strategy she has announced a new approach for cooperation with African countries, based on true partnership. Before her current post she was the Federal Minister for the Environment, Nature Conservation and Nuclear Safety.