With the climate crisis threatening over half of the global Gross Domestic Product, there can be no business-as-usual when the world begins to plan for a recovery from the Coronavirus Disease. Instead, we have a unique opportunity to change our relationship with nature by shifting our development pathway to one that is equitable and sustainable. Development Finance Institutions may be the “visible hand” that can guide and finance the future we want – but Africa will remain under the proverbial thumb of skyrocketing debt and climate catastrophe, if the new vision of development financing remains all talk and no action at the upcoming Finance in Common Summit.
Four hundred and fifty public development banks across the world are coming together to address the common need for new forms of prosperity that build the resilience of people and the planet. The twin crises, COVID-19 and the climate emergency, have made it clear, even for global financial institutions, that we must seize this moment to transform.
Among the key partners of this iconic summit is AfDB, who in 2019 made a commitment to get out of coal and build the “largest solar zone in the world” in the Sahel region. Sounds like music to your ears? Well, why let facts get in the way of solid excuses? In 2020, AfDB made an Expression of Interest to join the landmark $20bn Mozambique Liquefied Natural Gas financing. At a time fossil fuels are proving to be a bad investment, AfDB appears to have difficulties in openly committing to withdrawing from them.
Mozambique has been plagued by the resource curse akin to many fossil fuel producing nations. The expectations associated with this abundance have brought the nation to its knees. The 2009 announcement of massive natural gas discoveries in Cabo Delgado and the vision of leaping into middle-income status were all too promising. Over a decade later, the people of Mozambique have nothing to delight in. Instead, they experienced unfolding massacres, displacement and untold misery. Yet, AfDB continues to invest in this misery to the tune of $400m. The Acting General Counsel, Souley Amadou, said, “This is a first in class transaction that sets a new standard for mega projects on the African continent.” Disturbingly, this is how AfDB gaslights the continent in the name of investing in public development for the future.
The effects of financing fossil fuels were witnessed during Cyclones Idai and Kenneth, with more than 2.2m people in Mozambique, Zimbabwe and Malawi displaced. AfDB committed a whopping $100m to finance the three countries, a fraction of their overall investment in fossil fuels. This comes as studies confirm that mass green public investments are the most cost-effective means to revive ailing economies, ensure long-term stability, and nip climate change in the bud. A failed realisation of the devastating impact of climate change and consequent investment in dirty fossil fuels suggests that AfDB is complacent about the consequences of climate change. The bank’s investments in fossil fuels fuelled the transition of funds from public coffers into the bank accounts of private companies who pay insignificant taxes and drive the emissions causing the climate catastrophe.
As the world grapples with the two crises, we must interrogate current definitions and frameworks of development. Throughout history, projects across Africa in the name of ‘development’ have prioritised profits and GDP growth over people. Many of these developments lead to the loss of people’s rights, livelihoods and their lives, along with the destruction of Africa’s ecosystems and biodiversity. This begs the question, who is development for?
According to the International Panel on Climate Change, Africa is one of the most vulnerable continents to the accelerating climate crisis. Food insecurity, water shortages, cyclones, forced migration, gender-based violence, and an exacerbation of conflict are a few ways the climate crisis is already threatening the lives and livelihoods of millions of Africans. What’s more, COVID-19 has exposed the underlying structural flaws of our current socio-economic systems, which have ultimately failed to address the climate and social crises.
There has never been a more urgent time for a rapid and just transition of African economies away from their reliance on fossil fuels. Recent research indicates that wind, solar and other sources of green technology generate more than one-third of the world’s power, with solar photovoltaics surpassing coal and natural gas as the new cheapest energy source in most nations, according to the International Energy Agency. Experts also indicate that renewable energy has significant long-term prospects and may emerge stronger than before – if governments and financial institutions prioritise and integrate clean energy into COVID-19 recovery programmes.
Despite repeated calls from civil society on AfDB over the past few years, the bank is yet to publish a fossil fuel finance exclusion policy stating that it will not fund any coal, gas or oil project on the continent. It is time AfDB took a more decisive leadership role in fighting the climate crisis. The bank can and must do more to substantially expand its support for building Africa’s resilience and leaving fossil fuels in the past, by ensuring the continent leapfrogs to 100 per cent renewable energy and sustainable development.
If the realisation of AfDB’s green-washing troubles you, why not amplify the call for a just recovery during the upcoming FiC Summit? By working together, we can ensure another generation is not lost to a lifetime of hardship, because a sustained collective movement would force governments and public finance institutions to take drastic action and snap out of fossil fuel investments. This revolution is possible if enough people demand it.
*Migwi is Africa Campaigner at 350.org, Giliam is Branch Manager at African Climate Reality Project and Rodel is Communications Officer at African Climate Reality Project.
