African leaders, policymakers, business and civil society representatives came together for the first Africa Climate Summit in Nairobi, Kenya, from September 4 to 6. The summit, which held alongside the annual Africa Climate Week, ended with what is called the Nairobi Declaration on Climate Change. It was adopted by African Heads of State and Government in the presence of global leaders and high-level representatives on September 6. The declaration called for reforms to international financial institutions and new global taxes to fund climate action.
Here are five key takeaways from the declaration:
Global carbon tax regime
To make finance affordable and accessible for a green growth ambition, world leaders were urged to back a proposal for a global carbon tax on fossil fuels, maritime transport, and aviation, which can be complemented with a global financial transaction tax (FTT).
The final declaration was heavy on demands for major polluters to commit more resources to help poorer nations. Implementing such measures at a global level would ensure large-scale financing for climate-related investments and insulate from tax raises caused by geopolitical and domestic political pressures. The idea of a global carbon tax regime has never gained much traction, although a number of countries impose it.
$600bn for renewables
With 600 million people lacking access to energy and over 900 million others without clean forms of cooking, Africa’s energy gap is enormous. To meet this gap, the summit called for an investment of $600 billion to meet a renewable energy target of 300 Gigawatts (GW) by 2030 up from the current 56GW.
The declaration called for an alignment of global financial resources to support utilisation of Africa’s natural resources sustainably to allow for the scaling up of investments for renewable energy. Over the last decade, Africa attracted only $60 billion (two percent) of the $3 trillion investments in renewables across the world. To attract more funds and increase generation capacity, the Nairobi Declaration acknowledges the need to scale up demand for renewable energy and recommends moving energy intensive primary processing of Africa’s raw materials to the continent.
Restructuring of international financial system
The declaration advocated for reforms to the multilateral financial system and the development of a new Global Climate Finance Charter by 2025. The declaration called on multilateral development banks to increase concessional lending to poorer countries and for the “better deployment” of the IMF’s special drawing rights mechanism, which issued $650 billion as part of the Fund’s COVID-19 response. Other proposals included measures to help indebted countries avoid default such as instruments that can grant 10-year grace periods and extend sovereign debt tenor.
Green minerals given a wide berth
During the summit, discussions included the role of Africa’s key mineral resources in economic transformation for the continent. However, the declaration does not emphasise the importance of these strategic minerals and does not position them in the new vision for green growth.
New beginning for Africa’s climate politics
The Africa Climate Summit marked the first time the African continent has come together specifically to consider how to tackle the climate crisis from both a challenges and solutions perspective on its own terms. Host President William Ruto of Kenya closed the conference saying, “The cradle of humanity, Africa, is also its future. What Africa wants is what the world needs.”
