6. Conclusions: Ensuring alignment of needs and commitments

6.1 Harmonising the disparate international climate financing landscape

During the high-level consultations at COP26, developing countries criticised developed countries for failing to pledge to commit about US$100 billion annually to support climate action in developing countries. International institutions and developed countries must go beyond the promises and fulfil their pledges towards providing adequate financing for climate action to developing countries.

To do this, the widely used UNFCCC definition of climate finance needs to be amended to clear rules on what can be counted as “local, national or trans-national financing” or “public, private and alternative sources of financing” as developed countries operational definitions and interpretations of climate finance differ. In the past, several developing countries (such as India) have refuted claims by wealthy nations on their contributions to the delivering US$100 billion annual budget to support climate action in developing countries. Critiques have ranged from these figures being ‘‘overstated’’ to the methodological basis being ‘‘deeply flawed’’.^[152] Recently, an EU Court of Auditors report^[153] indicated that the EU had not met its climate spending targets. A reported spending of €216 billion on climate action in the EU’s 2014-2020 budget was more likely to be around 13% of the EU budget rather than the reported 20% and thus “not as high as reported”.

Lastly, more public and private funding from the international community needs to go towards adaptation efforts in support of a just transition, especially in Africa. As previously highlighted in our findings, most of Africa’s GHG emissions at a sectoral level come from land-use change and forestry (LUCF: 36%) and the energy sector (35%). These sectors are followed by agriculture (21%), industrial processes (4%) and waste (4%). To that extent, climate financing coming to and from the continent should not only prioritise low-carbon energy generation sources (mitigation) but must equally prioritise LUCF reductions (in this case, more adaptation-related financing). There is thus a need to look at how to combine the use of adaptation public funds with private funds in new and innovative ways, including at the community level.

6.2 Addressing the barriers to climate financing in Africa

Given the heavy reliance but significantly low donor climate finance inflows, Africa must look at alternative sources of financing to implement its NDCs to contribute to mitigating climate change while creating sustainable jobs in the process.

Unlocking the massive investment opportunities ultimately comes down to understanding the barriers to such investments at both the national and sub-national levels, and at the global level within the donor institutions themselves (Fig 6.1). For example, it is shown that, even when funding (either from public or private sources) is not a constraint, sub-national (local) governments are generally ill-equipped to facilitate successful access to and management of these funds or design and prepare ‘bankable’ projects. This issue is due to the lack of efficient regulatory frameworks, technical competencies and systems for project preparation as well as monitoring and evaluation, among others.

Fig 6.1 Constraints to securing such financing at the national and sub-national levels

Source: Author’s construct based on several literature sources and interviews with stakeholders (2022)