Africa's Just Transition

Crystal unpacks Africa’s climate vulnerability, the scale of funding required, and how green finance and sustainable investment models are key to ensuring the continent’s energy future is both fair and forward-looking.

The economic toll of climate extremes

Africa faces a paradox: it’s the least responsible for climate change, yet the most affected. In 2024 alone, nearly 8 million people were displaced across the continent due to floods, droughts, and other extreme weather events. According to the World Meteorological Organisation, these events are costing African economies between 2% and 5% of GDP annually, with governments allocating up to 9% of their budgets to disaster response – funds that could otherwise have gone towards development.

Making the case for a just transition

A just transition is not just about phasing out fossil fuels – it’s about doing so in a way that supports livelihoods, promotes inclusion, and enables access to affordable, reliable energy. For Africa, where infrastructure gaps remain wide and access to electricity uneven, the path to net zero must also drive socio-economic development. Countries like South Africa are engaging G7 nations to highlight the continent’s climate finance needs and advocate for more accessible, equitable support.

Green finance: from potential to pipeline

To meet its climate goals, Africa needs to quadruple current funding levels and secure an estimated $1.3 trillion annually by 2030. Development Finance Institutions have historically played a key role, but the gap is too wide for public funding alone. That’s where private capital comes in. Instruments like green shares and climate bonds are helping to direct funding towards clean energy, recycling, and sustainable infrastructure. These structures also offer accountability – helping investors track impact and ensure funds are used as promised.

The evolving role of sustainable finance

As RMB’s Beth Rivett-Carnac explains, sustainable finance has helped establish a global framework for directing capital from the global North to the global South. By aligning environmental and social outcomes with investment standards, it provides a familiar, trustworthy format for investors and a critical pipeline for Africa. Debt challenges remain a hurdle, but new mechanisms like gender bonds are helping channel funds towards under-resourced sectors and marginalised groups, ensuring the transition leaves no one behind.

Unlocking Africa’s climate opportunity

Crystal and Beth agree: to build resilience and secure long-term growth, Africa must access climate finance that is transparent, inclusive, and sustainable. It’s not just a matter of economic justice – it’s an opportunity to reimagine energy systems, empower communities, and lead the world in innovative, impact-driven investment.