COP 27 – African Businesses can Leverage Climate Action for Sustainable Business Growth

Sunday November 20, 2022 was the last day of the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP 27) in Sharm el-Sheikh, Egypt.

It is an opportunity for senior government officials and non-state actors to address climate change and its impacts, and a unique opportunity for Africa to lend a voice to the costs of climate change and climate action to the continent. There is no doubt that the world is at a climate crossroad, and time is running out for all stakeholders to take action towards decarbonization. Climate Action in Africa must help the continent build resilience, expand opportunities and inclusion, and birth climate-resilient green economies.

Here are some major considerations for African leaders and businesses:

1. Climate financing will require financial innovation to ensure novel fit-for-purpose financing models that builds on the existing green bonds, insurance, guarantees, blended finance, etc. The concept of an African carbon market will provide a platform for trading of carbon credits.

2. We need to pursue energy transition from fossil fuels to other energy sources that are widely available in Africa and the developing world such as natural gas. Nigeria should accelerate the implementation of its gas master plan especially the ‘Decade of Gas’ initiative, to prioritize investments in gas and usage of gas to fuel critical sectors of the economy.

3. Africa must participate actively in the global value chain by ensuring local processing of products to reduce the carbon emissions associated with transportation, shipping, and exports of raw materials from Africa to the West, and the import and shipping of finished/processed goods back into Africa. Local processing will reduce the net carbon emissions and waste.

4. We must rebuild our infrastructure (e.g., road, rail, electricity, etc.) to be climate resilient and to withstand the adverse impact of flooding, high temperatures, cyclones, etc.

5. Climate change is a global phenomenon, and its impact will affect humanity across continents, including Africa. African businesses therefore need to align to be ahead of the curve, prepare for the expected disruption, and not be caught napping.