Africa is being hit hard by climate change but has huge potential to minimise the impact and in some instances even triple a return on investment by embracing climate change adaptation, according to a report by the World Bank.
The report published on October 6, identified 3 African countries as possessing the highest potentials that could triple investments returns in the area of climate-smart infrastructure and create thousands of job opportunities, anchored on the fast-growing, youthful population of the continent.
The three countries are South Africa, Kenya and Ethiopia with the potential to generate billions of dollars from investments in more compact, clean and connected cities.
A 42 billion dollar investment in Ethiopia has likelihood of returning economic benefits worth 240 billion dollars, while an investment of 27 billion dollars in Kenya is estimated to be able to return 140 billion dollars, according to the report.
“In a region where much of the infrastructure, cities, and transportation systems are yet to be built, investments in climate-smart infrastructure can help cities create jobs,” the World Bank reported in its latest edition of Pulse Africa.
With 60 percent of its population under 25, Africa already has the world’s youngest population and by 2050 the United Nations projects the continent’s total population will reach 2.5 billion.
While the report acknowledges Africa has been hit hard by climate change, it notes that there is huge investment potential in climate change adaptation. The report points to opportunities in the decarbonisation of the grid, with renewable energy, nature-based urban infrastructure and scale-up of climate-smart agriculture as well as modernisation of food systems offering incredible returns as well as massive labour opportunities especially in Sub-Saharan Africa which suffers food shortage in the midst of arable land
“Financing climate change adaptation in Sub-Saharan Africa is essential, and policies to mobilize resources are critical to create more, better, and sustainable jobs,” says the report.
The development financier says a 215 billion dollar investment in South African cities would return the biggest benefits for an investment of this kind in Africa, with a return valued at 700 billion dollars.
What is in for Africa
About 120,000 jobs would consequently be created for youths in the Southern African country by 2050.
An average of 210,000 net new jobs would be created in Ethiopia, with Kenyan youths gaining from 98,000 employment opportunities, in the investment scenario painted by the report.
The World Bank says urban policies that are climate-sensitive could help local governments leverage their limited public finance with private sector investment to tap into these huge benefits.
Adoption of such policies would also help African countries address some of the pressing challenges, including pollution, floods, extreme heat and energy access.
“For instance, energy-efficient retrofits of buildings, low-carbon municipal waste and water, and green urban transport can deliver benefits to cities in the short and medium-term,” says the report.
It also highlights Africa’s unique context of low baseline development, preexisting climate vulnerabilities, limited energy access, and high reliance on climate-sensitive sectors like energy, agriculture.
In the midst of the challenges climate change poses to the continent, Word Bank says it provide potential investments opportunities to advance the ecomy of the continent, and provide sustainable jobs for its teeming youthful population. And this can only be achieved through concerted efforts by policymakers, investors (both domestic and foreign), interventionist programmes.
“They need to mobilize resources both domestically and internationally to deliver new jobs that are greener—and in the vicinity of existing products—and foster the manufacturing of more green products in the medium term,” explained the report.