4 November 2010, Johannesburg
- The African Carbon Asset Development Facility
(ACAD) announced seven green financing projects
today, following a successful second round
of fundraising for Africa's green economy,
at the African Bankers' Carbon Finance and
Investment Forum.
ACAD, a partnership
between the United Nations Environment Program
(UNEP) and its Risoe Center, the German
Government, and Standard Bank, has convened
the Forum in association with the UNEP Finance
Initiative (UNEP FI) and the Development
Bank of Southern Africa (DBSA). ACAD and
UNEP FI share the goal to help African financial
institutions understand why and how they
might get involved in the booming carbon
market. The event, which is also co-sponsored
by the German Federal Ministry of the Environment
(BMU), European Commission and World Bank,
was organized by ACAD to help African bankers
learn more about carbon finance and to facilitate
investment in green development projects
across Africa.
The Forum will highlight
the need for Public Private Partnerships
that develop skills, share opportunities
and unlock the huge potential of Africa's
green economy as a growth driver.
"ACAD's strategy
relies on deepening UNEP's engagement with
local financial institutions to jointly
develop local capacity, industries and markets
on a sustainable basis. Through our seed
funding and outreach activities, such as
this Forum, we seek to empower Africa's
green entrepreneurs struggling to access
the early-stage finance and technical support
they need to succeed," said Glenn Hodes,
Senior Energy Economist at UNEP Risoe, which
manages UNEP's activities related to carbon
finance and the Clean Development Mechanism
(CDM) and which has a pivotal role in facilitating
the participation of developing countries
in the emerging carbon market.
"Climate change
poses a new challenge and so it has to be
addressed using new tools. We use carbon
finance to provide wide-ranging economic,
environmental and social benefits to Africa
- including new revenue streams, access
to energy, job creation and technology transfer
- by deploying local, market specific solutions
and partnerships," said Geoff Sinclair
of Standard Bank's carbon trading division.
The meeting comes in
the run-up to the COP-16 in Cancun, and
COP-17 which is to be hosted in South Africa
next year. The time is considered ripe to
demonstrate that climate change can also
represent an opportunity for Africa, and
that African financial institutions have
a role to play. To this end, DBSA is developing
integrated programmes and mobilising resources
to initiate the transition to a low carbon
and green economy in partnership with several
national government departments.
Chantal Naidoo, Divisional
Executive from DBSA added: "We feel
strongly that events like this Forum are
fundamental to tapping the continent's carbon
investment potential - which could directly
contribute toward sustainable economic development
and social advancement. The challenge for
banks, including those in South Africa,
has been in developing strategies and financing
partnerships to get the good projects off
the ground and to educate the proponents
on how to ensure their interventions are
sustainable and replicable. These questions
are being answered here today."
Powering development
through sustainable energy is a major cornerstone
of the DBSA response strategy - dedicated
funding lines are available for both South
Africa and the rest of SADC for investment
projects in sustainable energy accessible
to municipalities and private developers.
In 2009 around US$84
billion was invested in 684 emerging market
emissions reduction projects worldwide.
But African countries shared only 2% of
the total and only South Africa and Kenya
have more than 10 projects in the CDM pipeline,
according to statistics from the UNEP Risoe
Center.
Even without any additional
stimulus, the 140 sub-Saharan African projects
currently in the CDM pipeline would create
85 million carbon credits worth over US$1.25
billion by 2012. Today, both the public
and private sector are now placing more
focus on sustainable development initiatives,
and the Green Economy in particular.
"Entrepreneurs
can transform markets, but support for eco-entrepreneurship
remains weak in many countries, particularly
across Africa. Developing private sector
skills and mainstreaming the concepts across
commercial finance and investment are key
to realizing Africa's abundant renewable
energy and climate mitigation potential
is critical," said Brigitte Burnett,
CSR Director at Nedbank and Chair of the
UNEP FI African Task Force.
Over 150 participants
from 20 countries across Africa attended
the forum, held at the DBSA Vulindlela Academy
in Johannesburg.
