COP27: Africa takes to the ring in world’s climate change fight
World governments, multilateral development banks, NGOs, corporates and financial institutions, will soon gather in Sharm El Sheikh for the UN’s 27th annual Climate Change Conference. In an interview, Hussein Abaza, chief executive and managing director of Egypt’s Commercial International Bank, describes the significance of COP27 for the country, the continent, and what he hopes it will achieve.
When COP27 gets underway on November 6 it will not only mark the UN’s 27th annual Climate Change Conference, but the fifth in Africa since the event first emerged on the geopolitical stage in 1995.
Yet, this time, unlike before, it is being billed as “Africa’s COP,” representing what many see as a real and urgent opportunity for the world to act in helping to protect the continent’s 54 countries from climate change, and, importantly, in providing the financing to do so.
During the event, developed countries will be held accountable for supporting developing countries with sufficient financing as they transition to a more sustainable economy over time
This is critical, and long overdue. Advanced economies – the primary accelerators of climate change due to industrialisation – have for years been promising billions of dollars of financial support to enable Africa’s climate change mitigation and adaptation efforts.
The harsh reality is that Africa is one of the most vulnerable continents to the pernicious effects of climate change, yet African countries contribute less than 4% of global greenhouse gas emissions – the lowest of all continents.
As global temperatures continue to rise, promises of helping to finance climate change mitigation and adaptation across Africa are insufficient. The time now is to act, says Hussein Abaza, CEO of Commercial International Bank (CIB), Egypt’s largest private sector bank and an important supporter of Egypt’s, and Africa’s, sustainability drive.
Q: What is the significance of COP27 being held in Egypt, and indeed Africa, this year?
Holding COP27 in Egypt – the heart of Africa and at the intersection between Africa and the Middle East and North Africa (MENA) region – is an opportunity to hear the voice of Africa, and all other developing countries, and focus on solving their challenges.
Indeed, Africa faces some serious environmental challenges, including water shortages, food security, energy problems, land degradation, deforestation, biodiversity loss and, overall, extreme vulnerability to climate change.
And yet, so far, there has been limited African representation in climate change management at the global political level. COP27 is Africa’s opportunity to be represented, to position the continent and its challenges front and centre of these discussions. Most importantly, it’s an opportunity to be an active actor in directing investments towards initiatives and projects for the region covering adaptation, mitigation and resilience for its survival.
Collaboration between African countries is key. President El-Sisi has said that “Egypt will continue to work side by side with its sister African countries to achieve sustainable development and intensify cooperative efforts to find answers to challenges and conflicts that the continent has suffered from for decades.”
Egypt, itself, is taking action and showing leadership – the country launched MENA’s first green bonds in 2020 under the government’s climate change strategy, which is a framework for a significantly improving the environment by 2050.
Q: More specially, what are you hoping will be achieved COP27?
COP27 is a crucial opportunity to fulfil Africa’s needs for adaptation project finance for the water, food and energy nexus, as well as advocating action across all areas of climate change crisis, with an emphasis on safeguarding people from the immediate effects of climate change and ensuring no one is left behind.
We hope that COP27 establishes the business case for sustainable investments in Africa, which will help mobilise one trillion US dollars for Africa, targeting adaptation to the adverse impacts of climate change, and enable the implementation of Africa’s Nationally Determined Contributions by 2030.
In the coming years, Africa will experience severe adverse direct effects from climate change due to its high dependence on rainfed agriculture and its limited capacity to adapt. Projections under the Intergovernmental Panel on Climate Change (IPCC) Representative Concentration Pathway, suggest that warming scenarios will have devastating effects on crop production and food security.
The number of undernourished people in drought-prone African countries has already increased by 45.6% since 2012, according to the Food and Agriculture Organisation (FAO) of the UN. In 2022, the UN estimates that 120 million people across the continent face a food crisis.
COP27 will advocate for an integrated and holistic nexus approach to Africa’s food systems, energy access, water issues and climate adaptation. Specifically required are an integrated approach to energy access and agriculture value chains, as well as enhancing climate adaptation through investments in agriculture-enabling infrastructure to minimise loss. We aim to promote a resilience campaign for Africa to feed itself, in addition to efforts to decarbonise Africa in collaboration with GFANZ’s African Network.
During the event, developed countries will be held accountable for supporting developing countries with sufficient financing as they transition to a more sustainable economy over time. We must first meet current financial commitments, which involves a $100 billion finance goal and the doubling of global adaptation finance.
Q: What are some of the key challenges that Egypt and Africa more broadly face in driving sustainability?
A key challenge for Egypt and Africa is the lack of advanced, suitable technologies that could pave the way for new paths to sustainable development that take into account the continent’s economic, social, and environmental dimensions.
The lack of sustainability regulations and frameworks is also a challenge. To help overcome this, the Central Bank of Egypt in 2021 issued the Guiding Principles on Sustainable Finance. The Financial Regulation Authority has also mandated environmental, social and governance (ESG) disclosures and Task Force on Climate-related Financial Disclosures (TCFD) for listed companies. These are intended to enhance planning and developing general frameworks for the application of sustainable finance, building capabilities, and providing guidance.
The need for an African taxonomy is also a key challenge that requires several entities and stakeholders to work on across the African continent.