Blog Post

Africa Climate Business Plan Focuses on Increasing Resilience

The World Bank recently released the Africa Climate Business Plan , which aims to raise awareness of and accelerate resource mobilization for prioritized climate adaptation and low-carbon initiatives in Africa. Climate-related factors are involved in most of the shocks that keep or push African households into poverty; these include natural disasters, health shocks, crop losses and food price shocks. The plan notes that if climate variability and change remain unaddressed, they will jeopardize Africa’s development achievements and its aspirations for further growth and poverty reduction.

Broadly, the plan supports adaptation and resilience programs that reduce the risks posed to development by climate variability and change, highlighting the need for African countries to strengthen the resilience of their natural, physical, and human capital. More specifically, the plan supports activities that 1) protect natural capital by making farmland, landscapes, watersheds, and oceans more resilient, 2) preserve physical capital by adopting climate-smart policies in cities and coastal areas, and 3) protect human capital by boosting social protection and addressing the drivers of migration.

The plan emphasizes that current levels of funding for climate adaptation in Africa are estimated to be around $3 billion a year. In contrast, the World Bank and the United Nations Environment Programme estimate that Africa needs $5–$10 billion a year (currently) to adapt to a 2 degree C warming, $20–$50 billion to do so around mid-century, and close to $100 billion if warming increases by 4 degrees C. The World Bank estimates that fast-tracking the Africa Climate Business Plan will require about $16.1 billion between 2016–2020 and as much as $21 billion by 2024. Of the $16.1 billion that the plan proposes, $5.7 billion is expected to come from the World Bank, $2.2 billion is expected to come from various climate finance instruments (such as Climate Investment Funds, the Green Climate Fund, and the Global Environment Facility), $2.0 billion from others in the development community, $3.5 billion from the private sector, and $0.7 billion from domestic sources. This leaves an additional $2.0 billion needed to deliver on the plan.

The report also highlights the importance of agriculture in Africa for both broad-based development and climate change adaption. Agriculture is a major economic driver in Africa and is key to poverty alleviation and food security. The agricultural sector typically represents 30–40 percent of GDP and employs around 65 percent of the labor force in Africa, providing livelihoods for millions of smallholders and their families. Studies have also that agricultural growth reduces poverty by about three times as much as growth in other sectors. Climate variability is affecting, and will continue to affect, agricultural productivity in the region; crop productivity simulations show that cereal yields between 1981 and 2002 would have been 2–3 percent higher in the absence of climate shocks. Without action to improve the resilience of Africa’s agricultural sector, a 2 degree C rise in average temperatures by the middle of the century could reduce yields by up to 20 percent. This will place even more burden on Africa’s food security; the region is currently home to more than 225 million undernourished people. Thus, initiatives that support climate change adaptation and agricultural resilience are extremely relevant.

One major strategy that the plan proposes to increase countries’ climate resilience is the scaling-up of low-carbon energy sources. In addition to helping mitigate climate change, these initiatives offer considerable resilience benefits, as societies with inadequate access to energy are also more vulnerable to climate shocks. Increased access to sustainable energy sources is likely to contribute to increased agricultural mechanization and the ability of African countries to process and store food.

The Africa Climate Business Plan will also launch two specific initiatives to help countries to increase their resilience. The first initiative is to strengthen Africa’s Hydro-Meteorological Programs by providing investments, technical assistance, and capacity building. These programs are crucial because African agriculture is predominantly rainfed and requires accurate and timely weather information. The second initiative focuses on establishing a climate-resilient investment facility which would strengthen policymakers’ data and knowledge base, allowing them to better integrate climate variability and change into a variety of decision-making processes at the local, national, and regional levels.