De-risking climate financing in Sub-Saharan Africa

Climate financing in Sub-Saharan Africa has been a key topic of discussion, with a focus on de-risking investments to attract more funds into the region. Development finance institutions (DFIs) play a crucial role in this endeavor, working to create innovative financial instruments and partnerships to leverage resources from the private sector. In a recent interview with CNBC Africa, Olympus Manthata, Head of Climate Finance at the Development Bank of Southern Africa, shed light on the progress made following last year's COP and outlined key priorities for the year ahead. Manthata emphasized the importance of maintaining momentum and pressure to drive progress in climate financing. While acknowledging that more strides need to be made, he highlighted the necessity of continuous dialogue and action to ensure tangible results. He noted that DBSA had committed to doubling their renewable energy program, focusing on innovative financial instruments and partnerships to attract additional resources. One of the key strategies discussed by Manthata is the use of consensual finance to de-risk climate investments and scale up projects in the region. DFIs rely on their proximity to policy making and ability to co-finance with the private sector to create an enabling environment for sustainable investments. By influencing regulatory direction and partnering with private entities, DFIs can drive significant movement in the climate financing sector. The risk premium associated with climate financing in Sub-Saharan Africa can be mitigated through the efforts of DFIs like DBSA. By leveraging partnerships and innovative financial instruments, these institutions are working to attract more private sector investment into renewable energy and sustainable projects in the region. Looking ahead, the focus remains on translating financial pledges into actionable activities that benefit countries in need of resources. Discussions around loss and damage, as well as commitments to move away from fossil fuels, continue to shape the agenda for climate financing. While challenges persist in tracking progress from one COP to the next, the emphasis on collaboration, innovation, and partnership is key to driving positive change in Sub-Saharan Africa's climate finance landscape.