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Africa to lead global green economy – Dr Gori Olusina Daniel

“I remain optimistic about Africa’s ability to lead in the global green economy.” So said Dr Gori Olusina Daniel, the Managing Partner at Africa PPP Advisory Services (AP3) and an advisory board member of Africa’s Green Economy Summit (AGES). 

AGES is a transformative experience that underscores the immense potential of collaborative platforms in accelerating Africa’s transition to a sustainable green economy.

The company has performed a two-year study on climate finance to explore how low- and middle-income countries (LMICs) can better access climate finance for sustainable transport projects.

The key takeaways

• Barriers to climate finance: LMICs face significant barriers, including limited institutional capacity, inadequate project preparation, and gaps in knowledge about available finance mechanisms. Addressing these requires coordinated efforts across multiple levels.
• An enabling environment is crucial: A robust policy and regulatory framework and institutional readiness are essential for attracting climate finance. Governments in LMICs must prioritise sustainable transport in national and regional development plans.
• Capacity building is key: Enhancing the capacity of project sponsors to design, develop, and present bankable projects is a game-changer. This includes knowledge of climate finance mechanisms and the ability to engage with stakeholders effectively.
• Collaboration drives impact: Partnerships between governments, donors, private sector actors, and civil society organisations are critical for aligning priorities and unlocking finance.
• Scalable solutions exist: The Avoid-Shift-Improve framework offers a structured approach to project planning, focusing on reducing transport demand, promoting sustainable modes, and improving technology and efficiency.

COP29 announcements on climate finance

Touching on COP29 announcements about climate finance, Dr Daniel stated that the announcements have added momentum to climate finance initiatives, though the extent of their impact varies among stakeholders.

“Developed nations committed to providing $300 billion annually by 2035 to support developing countries in combating and adapting to climate change.

“This pledge represents a significant increase from the previous $100 billion annual commitment.

However, many developing nations have criticised this figure as insufficient, arguing that it falls short of the $1.3 trillion necessary to effectively address climate challenges. India’s negotiator, Chandni Raina, described the $300 billion pledge as “abysmally poor” compared to what is needed,” he said.

He adds that despite these criticisms, establishing a concrete financial commitment provides a foundation for further negotiations and enhancements.

“The issuance of a $500 million bond by the Climate Investment Funds (CIF), which received over $3 billion in investor orders, exemplifies innovative approaches to mobilising climate finance. This move is seen as a significant step toward leveraging capital markets to scale green investments.”

The role of green entrepreneurship to drive the transition to a more sustainable economy in Africa

Speaking about the future of the green economy, Dr Daniel underscored the role of green entrepreneurship, stating that it can help develop and propagate new technologies, create new markets, and drive change in the business sector.

“Stimulating green entrepreneurship is therefore an important lever that governments can use to drive the transition to a more sustainable economy. Green entrepreneurship is pivotal in driving Africa’s transition to a sustainable, inclusive, and resilient green economy,” he said.

He stated that while green entrepreneurship holds immense potential to drive Africa’s transition to a sustainable and inclusive green economy, several critical obstacles hinder its growth and scalability. These challenges are interconnected and require coordinated efforts from governments, the private sector, and international partners to overcome.

He highlighted the challenges as:

• Limited access to financing: Securing funding remains one of the most significant barriers for green entrepreneurs in Africa. Challenges include:
• High perceived risks: Investors often view green businesses, especially startups, as high-risk due to their innovative nature and reliance on unproven business models.
• Lack of tailored financial instruments: Traditional financial systems may not offer products suited for green businesses, such as concessional loans or grants.
• High costs of capital: Many green entrepreneurs struggle with accessing affordable financing, limiting their ability to scale operations.

He highlighted the investment opportunities across various sectors in Africa, driven by growing demand for sustainable solutions, climate finance, and innovation.

He said these opportunities are particularly exciting as they align economic growth with environmental sustainability, creating impact-driven business models with high potential for scalability.

“The opportunities in green entrepreneurship across Africa are vast, ranging from renewable energy to sustainable agriculture and transportation. These sectors not only present attractive returns for investors but also address critical challenges facing the continent, aligning with global sustainability goals.

“As financing for green projects expands, Africa is uniquely positioned to become a global leader in green innovation. The intersection of impact and profit in these ventures makes them particularly exciting for stakeholders committed to a sustainable future.”

About the author

ESI Africa
Content Team

ESI Africa

ESI Africa is the global leader in disseminating African utility, energy, power, mobility and water market news and insights. We provide over 50,000 professionals with renowned high quality and insightful editorial, equipping them with essential information to drive their own businesses.