Unlocking finance for a just and sustainable transformation

Although Africa contributes the least to global emissions, it receives only about 3% of global climate finance. High debt servicing costs compress fiscal space. Elevated borrowing costs inflate the price of capital for governments and firms alike. Each year of delay in closing this gap raises costs and the consequences fall most heavily on those least responsible for the crisis.

The financing gap is not a shortage of investable opportunity. It is structural: elevated risk perceptions, fragmented pipelines, shallow domestic capital markets and limited access to long-term, affordable finance.

The scale, structure and sequencing of capital flows will determine whether Africa’s climate ambition translates into productive assets, resilient systems and competitive industries or remains constrained by fiscal pressure and misaligned incentives. Domestic financial institutions need the capacity to design, steward and deploy capital effectively. Blended finance instruments need to be scaled to absorb early risk and unlock larger pools of public and private investment. Additionally, the global rules governing access to concessional finance, liquidity and capital must be reformed to reflect African development realities and not perpetuate the structural disadvantages that created the gap in the first place.