Min menu


Featured Articles

Blog: Why the transition to an inclusive green economy is vital to achieving Africa's climate goals


Blog by Somik Biswas, Commonwealth National Climate Finance Adviser to Mauritius and Athniel Yella, Commonwealth National Climate Finance Adviser to Zambia

For much of the last century, economic theories have tilted toward economic growth at the expense of the environment and social justice, creating imbalances between and within countries while spurring climate change, biodiversity losses, and inclusive growth.

Blog: Why the transition to an inclusive green economy is vital to achieving Africa's climate goals

However, recent research indicates that sustainable economic growth can only be achieved by investing in low-carbon, less polluting models of development. Among them is the concept of an "inclusive green economy", which refers to a model of economic growth that is resource-efficient, non-polluting, and equitable.

Today, it remains the best hope for lifting hundreds of millions of Africans out of extreme poverty and achieving sustainable long-term development for the continent.

Read MoreWhat is social and solidarity economy and why is it important?

What is an inclusive green economy?

The term "green economy," which appeared in a 1989 report titled Blueprint for a Green Economy, was defined by the World Resources Institute as "an alternative vision of growth and development; growth and improvements in people's lives can be generated in ways consistent with sustainable development."

An inclusive green economy is one that fulfills the interrelated economic, social and environmental commitments that reflect the Sustainable Development Goals (SDGs) and the Paris Agreement on Climate Change.

Hence, an inclusive green economy takes into account the whole-of-society approach in eliciting drivers of economic growth. It focuses on sustainable means of production as well as the sustainable and responsible consumption of economic goods and services. This increases resource efficiency and reduces waste throughout the economy.

Basically, six major sectors contribute to the green economy - renewable energy, green buildings, sustainable transportation, water management, waste management and land management.

While climate change has forced many countries to rethink their commitment to the environment along with economic growth, the COVID-19 pandemic, which was followed by the war in Ukraine, has brazenly exposed many economies around the world to the shocks of supply chain disruption, highlighting the lack of Feasibility of the "growth only" model.

This has led countries to realize the importance of a more sustainable and green economic path, with many now seeking a different approach to economic growth that is inseparable from environmental protection and social justice.

The green economy and its context for Africa

Africa is in an excellent position to harness the benefits of transitioning to an inclusive green economy. For example, the United Nations Environment Program (UNEP) suggests that under green economy investment scenarios, Kenya's real GDP is expected to exceed the business-as-usual model by about 12% by 2030.

In fact, more than 83% of national climate plans include targets to reduce greenhouse gases, with focus areas including energy, agriculture, waste, land use and forestry - also key sectors of green economy interventions.

Africa has abundant natural resources, specifically lithium, graphite, cobalt, nickel, copper, and rare earth metals – all of which are essential components of the transition to e-mobility and represent new market opportunities for achieving net-zero targets as well as sustaining livelihoods.

Seven countries in Africa are expected to be among the ten fastest growing economies in the world: Uganda, Kenya, Tanzania, Madagascar, Senegal, Malawi and Zambia. This means a significant increase in energy demand from homes, industry, transportation and power generation.

The green economy approach is allowing African countries to transition to a greener path of power generation and at the same time meet their growing energy demand, backed by lower renewable energy costs, with solar panel prices dropping 80% in the past decade and wind energy prices 40%.

The United Nations estimates the annual investment gap for renewable energy infrastructure at between $380 billion and $680 billion. Through policy interventions focused on the green economy, African countries have enormous potential to bridge the financing gap.

So far, Nigeria has been able to tap into the green, social and sustainable bond market to raise funding. Direct policy measures are required to attract such funding to more African countries. For example, Burkina Faso has implemented a new investment law that reduces performance obligations for investors in the green and renewable energy sectors.

Africa is also likely to embark on rapid urbanization that needs better planning to develop more compact and resource-efficient cities.

The transition to a green economy would create new jobs as well as bring more investment to Africa. This is critical for Africa where nearly 70% of the population is under the age of 30 and new arrivals join the workforce every year. For example, the United Nations Environment Program estimates that the expansion of solar and wind energy in Senegal will create up to 30,000 additional jobs by 2035.

Green economy principles applied in the context of agriculture, land use and forestry activities can pave the way for drought mitigation and prevention of desertification in many sub-Saharan countries. The Great Green Wall Initiative sets a great example by contributing to revitalizing Africa's degraded landscapes on an unprecedented scale, providing food security and jobs and reducing migration, all in just a decade.

Blog: Why the transition to an inclusive green economy is vital to achieving Africa's climate goals

The newly adopted Commonwealth Living Lands Charter is a platform through which countries can coordinate action on climate change, biodiversity loss and land degradation.

What is required?

The transition to an inclusive green economy first requires strong institutional and policy support, political will, and a participatory approach among stakeholders from the public, private and community sectors.

For example, Ethiopia has developed the Climate Resilient Green Economy Strategy which describes the steps required to transform Ethiopia's economy into a carbon-neutral and climate-resilient economy, as well as outlining the roles and responsibilities of governmental and non-governmental stakeholders.

Second, it also needs to be supported with adequate funding to enable resource-limited countries or communities to move towards a more sustainable future. These countries cannot be expected to embark on a green transition without adequate support in creating an enabling environment, technology transfer and financing from more advanced economies and other sources of financing.

This is especially important for Commonwealth countries where natural disasters affect about 28 million people and cause economic losses of $8 billion each year.

To meet the requirements of the Sustainable Development Goals and the commitments of the Paris Agreement, the world needs to invest $90 trillion in infrastructure by 2030. Developing countries - including many Commonwealth countries - will require 70% of this investment. The Global South will account for nearly two-thirds of all infrastructure investment (~US$4 trillion annually) over the next decade. The African Development Bank estimates that universal access to electricity in Africa by 2030 will require up to $40 billion per year.

However, very little available global funding is directed to Africa. This makes mobilizing $100 billion in climate money annually by 2025 and separate financing for adaptation critical to just the transition of African economies.

Opportunities for inclusive green economies

Natural capital is an important economic asset and source of public goods, especially for the poor whose livelihoods depend on natural resources. Thus, the transition to an inclusive green economy creates enormous opportunities for investment and job creation and has the potential to catapult Commonwealth countries to the level of their global peers, in terms of responding to climate change.

Large Commonwealth countries such as India, for example, have made significant investments in renewable energy generation and provide significant opportunities in sustainable urban transport.

In Africa, Namibia is embarking on a sustainable green hydrogen policy and implementation of a roadmap, in line with the Long-Term Development Framework (Vision 2030). Similarly, Zambia has adopted the green economy as the mainstay of its development path, with a dedicated ministry focusing on the green economy which was established about a year ago.

Mauritius is preparing a circular economy roadmap to reduce waste generation, increase its share of renewable energy to 60% of generation as well as “greening” its tourism sector.

Thus, all these countries, along with other African countries, present an opportunity for investors to partner with them to make a fair transition and enable robust climate action in the Global South.

The Commonwealth recognizes the need for financing to enable the transition to a green economy. To this end, through the Commonwealth Center for Climate Finance Access (CCFAH), regional and national advisors are integrated within host institutions and national government line ministries respectively, to provide technical assistance to secure gender-responsive climate finance to support the inclusive transformation of the green economy.

The Commonwealth also seeks multi-stakeholder partnerships to promote an inclusive green economy with other interested stakeholders including the private sector, civil societies, academia and other development partners.

If we are to avoid the catastrophes of global warming fueled only by the economic growth model, an effective transition to a green economy that is enabled by strong leadership from government and the private sector, strong and vocal engagement and partnerships with civil society organizations including women, youth groups and social movements, along with the interventions of Adequate and sustainable financing is the need of the hour.