Africa is likely to suffer some of the worst effects of climate change and is ill-prepared to cope, officials said May 14, advocating better access for the continent to world carbon markets.
“If the sea level rises, most of the African large cities are going to be under threat,” Ann Kajumulo Tibaijuka, executive director of U.N.-Habitat, Kenya, told a forum ahead of the annual African Development Bank (AfDB) meeting in Shanghai.
China plays host to the AfDB’s May 16-17 board meeting in Shanghai, attended by economic ministers and central bank governors from the 53 African states and 24 non-African members. The bank’s first board meeting to be held in Asia comes at a time when China is leading a global scramble for oil and raw materials that is propelling growth on the world’s poorest continent.
In April, climate experts issued their starkest warning yet about global warming, blamed on human emissions of greenhouse gases from burning fossil fuels, findings that are expected to spur governments to greater action.
With only 3 percent of the world carbon market in Africa, experts urged the African Development Bank to take a more active role in promoting the sector and in financing power projects, including hydropower, that promote alternatives to greenhouse gas-emitting fuels like coal and oil. (HNN 5/9/07)
“The African Development Bank is well-positioned to be a financier of greenhouse gas reduction projects,” said Ogulande Davidson, a professor at the University of Sierra Leone and a co-chairman of one of the U.N. Intergovernmental Panel on Climate Change’s working groups.
Right now, officials said, there is no mechanism to make Africa attractive to carbon markets and African governments did not alone have the capacity to spearhead a low-carbon drive.
“Public funds are not sufficient. We need private sector involvement, and for that, we need new financial instruments,” said Yogesh Vyas, head of the environment unit at the African Development Bank.
Report: Africa to grow faster in 2007
In an economic report ahead of the Shanghai meeting, the AfDB saw a “highly favorable” outlook for much of Africa, predicting an above-trend average growth domestic product growth of 5.9 percent this year and 5.7 percent in 2008, compared with estimated 5.5 percent last year.
AfDB members are debating priorities for funding, such as education, telecommunications, roads, and infrastructure projects, where Chinese companies have taken on a prominent role.
Senior South African Treasury official Ismail Momoniat said careful planning of such projects was as important as funding and he recommended the AfDB become more involved in this.
“It will probably require the AfDB to prioritize capacity building,” he said.
Africa still lacks safe water despite strong growth
Despite several years of strong economic growth, AfDB said access to safe drinking water has not improved in Africa, especially the sub-Saharan region.
Even if Africa’s economy grows the 5.9 percent forecast this year, the bank said Africa is unlikely to meet the Millennium Development Goal of providing safe drinking water for 78 percent of the population by 2015.
“We have been achieving growth in GDP that is not trickling down,” Barfour Osei, a senior AfDB economist, told a May 13 conference. “It is very simply the fact the growth we have been achieving on the continent has not been pro-poor enough.”
In sub-Saharan Africa only 56 percent of the people have access to what the bank calls “improved” drinking water; that leaves 332 million people without such access, a number expected to increase by 47 million by 2015.
The bank recommends that Africa invest US$20 billion a year until 2025 in providing a sustainable water supply, including drinking water and sanitation, but said that finding financing was a challenge.
Government budgets and development aid have been too small to cover the large investments needed, and economists said it was one of the least attractive sectors to private investors.
“This is for the simple reason that the characteristics of the sector introduce a basic good, which means that the regulatory process very seldom can allow for a rate of return more than 5 to 10 percent,” said Kenneth Ruffing, one of the report’s coordinators.