Sharm El–Sheikh, Egypt, 12 November 2022 – African Export-Import Bank (Afreximbank) has pledged to support Africa to bridge the USD250 billion climate finance gap in collaboration with other African financial institutions.
Speaking at the ongoing COP27 Conference hosted by the Arab Republic of Egypt in Sharm El Sheikh, Denys Denya Afreximbank’s Executive Vice President – Finance, Administration & Banking Services said, “African financial institutions, with Afreximbank at the forefront, need to step in and bridge the finance gaps. With the right support and commitment, Africa can in addition achieve the vision and goals of the AfCFTA, helping Africa’s population grasp the opportunities within it, and ensuring it plays a leading role in revitalizing Africa’s climate adaptation and mitigation initiatives”.
“The AFCFTA offers not just intercounty trading opportunities, but vast opportunities for collaborating on research, and investing in the continent’s large youthful and innovative population. African nations can leverage on these strengths as they decarbonize,” Denya added.
He urged African financial institutions to offer both financial and technical support which would then be targeted at curbing Africa’s greenhouse gas emissions, ensuring the achievement of the goals under the AfCFTA are not derailed.
While also speaking on the effects of climate change on the continent during COP27’s decarbonisation day, Dr. Elias Kagumya, the Bank’s Chief Risk Officer, commented that it is high time Africa turned to the continent’s vast mineral resources to finance adaptation, loss and damage and build resilience in the continent.
Dr. Elias added that, “With the world turning to clean energy technologies, the need for minerals like copper, lithium, nickel, cobalt and rare earth elements have and will continue to grow.”
The continent is endowed with a wide variety of minerals critical for the clean energy transition. The Democratic Republic of the Congo (DRC) is home to about 70 per cent of the world’s cobalt essential for batteries, mobile phones and electric cars production. Countries such as Zimbabwe and Namibia have among the largest reserves of lithium globally. Exploring these minerals would greatly support bridge Africa’s climate finance gap and change the fortunes of the continent’s poorest.
Africa continues to be the least emitting continent, but the continent continues to battle unprecedented forest fires, droughts, soil erosion, landslides, cyclone, and floods, which are expected to get worse as temperatures rise. For example, in 2022 floods killed at least 600 people across Nigeria displacing 1.3 million people and in Somalia, over one million people fled their homes as a four-year consecutive drought devastated the East and Horn of Africa.
For African governments and stakeholders, ensuring that the AfCFTA does consider a green transition is a huge mandate, and the implementation of the AfCFTA forms part of the larger solution to Africa’s climate change issues. However, critical financing is important to achieve this. And if done correctly, experts agree, AfCFTA can help in shaping the transition of African economies to green growth, climate adaptation and mitigation.
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About Afreximbank
African Export-Import Bank (Afreximbank) is a Pan-African multilateral financial institution mandated to finance and promote intra-and extra-African trade. Afreximbank deploys innovative structures to deliver financing solutions that support the transformation of the structure of Africa’s trade, accelerating industrialization and intra-regional trade, thereby boosting economic expansion in Africa. A stalwart supporter of the African Continental Free Trade Agreement (AfCFTA), Afreximbank has launched a Pan-African Payment and Settlement System (PAPSS) that was adopted by the African Union (AU) as the payment and settlement platform to underpin the implementation of the AfCFTA. Afreximbank is working with the AU and the AfCFTA Secretariat to develop an Adjustment Facility to support countries in effectively participating in the AfCFTA. At the end of 2021, the Bank’s total assets and guarantees stood at about US$25 billion, and its shareholder funds amounted to US$4 billion. Afreximbank disbursed more than US$51 billion between 2016 and 2021. The Bank has ratings assigned by GCR (international scale) (A), Moody’s (Baa1), Japan Credit Rating Agency (JCR) (A-) and Fitch (BBB). The Bank is headquartered in Cairo, Egypt.
For more information, visit: www.afreximbank.com.
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Media Contact: Amadou Labba Sall asall@afreximbank.com