Akinwumi Adesina, President of the African Development Bank (AfDB), has stated that Africa loses between $7 billion and $15 billion yearly because of climate change.
In an interview with the BBC, he highlighted that Africa is at the forefront of countries most severely affected by the impacts of climate change, which have devastated agriculture and economies. This impact continues, despite Africa contributing only 3% of global emissions.
“In response, the AfDBank has inaugurated ambitious initiatives to build resilience and adapt to a changing climate. The AfDB has committed to doubling its climate finance to $25 billion by 2030, focusing on the African Adaptation Acceleration Programme.
“This programme aims to deploy $25 billion for climate adaptation, making it the largest globally. Additionally, the AfDB has created a climate action window with an initial investment of $429 million, expected to grow to $13 billion,’’ he said.
The AfDB president said the opportunity supports vulnerable countries with crop insurance, land restoration and climate information services.
He mentioned that Innovative financial mechanisms helped with the climate adaptation initiatives.
He stated that the AfDB had started using partial credit guarantees which helped countries like Benin, Senegal, and Cote d’Ivoire to raise significant capital at lower interest rates.
“For example, Benin raised $400 million from Chinese investors using a $195 million partial credit guarantee. The AfDB also facilitated Egypt’s Panda Bond issuance, allowing the country to secure 500 million dollars from Chinese markets.
“These financial innovations reduce the cost of borrowing for African countries and encourage long-term investments in climate resilience. In spite of the challenges posed by climate change, Africa is leading the charge in innovative solutions and sustainable development,” he said.
Adesina remarked that the current global financial system wasn’t adequately meeting Africa’s needs and needed reform. Speaking about Special Drawing Rights (SDRs), he emphasised that the bank was advocating for Africa to receive and utilise SDRs more effectively.