Breaking Financing Barriers for a Just Climate Transition in Africa

This policy brief identifies five systemic barriers preventing African countries from accessing necessary climate finance and proposes specific interventions to enable a just climate transition.

• Unsustainable public debt severely limits the capacity for public climate funding in Africa. Collective public debt reached US$1.8 trillion in 2022, representing a 183 percent increase since 2010. In Sub-Saharan Africa, the average public debt-to-GDP ratio is 56 percent, with some economies spending more on debt servicing than on recurrent expenses.
• There is a significant gap in climate action funding, with an overall estimated gap of US$2.8 trillion. Furthermore, 75 percent of the US$100 billion climate finance pledge made under the Paris Agreement to developing countries has been misdirected or not deployed.
• Investment in African climate projects is hindered by high risk perception and currency fluctuations. Investors often view projects as too costly or risky due to concerns over market conditions, project quality, and unclear policies. Additionally, foreign exchange risk in these markets is often higher, or perceived as such, than in developed countries, which can increase funding costs or limit capital flows.
• Private sector involvement in climate action is insufficient, with every US$1 of public climate finance unlocking less than 30 cents of private capital. Barriers to private sector participation include low awareness, high requirements, and a lack of support.

APA

Moors, R. (2023). Breaking Financing Barriers for a Just Climate Transition in Africa. African Center for Economic Transformation. https://acetforafrica.org/research-and-analysis/insights-ideas/policy-briefs/breaking-financing-barriers-for-a-just-climate-transition-in-africa/

Chicago

Moors, Rik. Breaking Financing Barriers for a Just Climate Transition in Africa. African Center for Economic Transformation, 2023. https://acetforafrica.org/research-and-analysis/insights-ideas/policy-briefs/breaking-financing-barriers-for-a-just-climate-transition-in-africa/.

Wikipedia

{{cite report |last1=Moors |first1=Rik |title=Breaking Financing Barriers for a Just Climate Transition in Africa |publisher=African Center for Economic Transformation |date=1 November 2023 |url=https://acetforafrica.org/research-and-analysis/insights-ideas/policy-briefs/breaking-financing-barriers-for-a-just-climate-transition-in-africa/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{moors2023breaking, author = {Moors, Rik}, title = {{Breaking Financing Barriers for a Just Climate Transition in Africa}}, institution = {African Center for Economic Transformation}, year = {2023}, month = nov, url = {https://acetforafrica.org/research-and-analysis/insights-ideas/policy-briefs/breaking-financing-barriers-for-a-just-climate-transition-in-africa/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }