The European Green Deal and the African Private Sector

This report by the Africa Policy Research Institute (APRI) analyzes the implications of the European Green Deal (EGD) for the African private sector. It explores how Africa's abundance of critical minerals and renewable energy potential—particularly for green hydrogen—positions the continent as a strategic partner for the EU's goal of net-zero emissions by 2050. The document identifies financial, technological, and capacity-building opportunities for African companies, while warning against the risk of Africa remaining a mere resource supplier in an unequal partnership.

• The European Green Deal (EGD) is a comprehensive strategy for the European Union to achieve a green economy and net-zero emissions by 2050. While primarily domestic, it creates global opportunities for the African private sector through new financial sources, technology transfer, and partnerships.
• Africa is strategically vital to the EU's energy security and the EGD's success due to its potential for wind, solar, geothermal, and hydroelectric power, as well as its capacity for green hydrogen production. The EU-backed Hydrogen Accelerator aims to create a €100 billion value chain, and investments from Europe in African green hydrogen could reach 75.6 billion Euros by 2030.
• The EU's need for critical raw materials for clean technologies—including nickel, cobalt, lithium, manganese, graphite, rare earth elements, copper, and aluminum—creates 'nearshoring' opportunities for the African private sector. Specific countries are highlighted for their resources: the Democratic Republic of the Congo (copper-cobalt), South Africa (manganese and platinum), Zimbabwe (lithium), Rwanda (tantalum), and Zambia (copper, cobalt, gold, and nickel).
• Various EU funding mechanisms are available to the African private sector, including InvestEU (slated for 372 billion Euros between 2021-27) and the Global Gateway Africa – Europe Investment Package (150 billion Euros). Other facilities include the Green Economy Financing Facility (GEFF), which provided up to 150 million Euros for SMEs in agriculture, construction, commercial, and manufacturing sectors.
• The report identifies three primary modalities for African companies to access the EGD: independently, in cooperation with European partners, or by establishing a subsidiary company within the EU.
• There is a significant risk that the EGD could foster an 'unequal partnership,' where African countries are locked into the role of mere resource suppliers for the EU, particularly in the critical raw materials and green hydrogen sectors.
• The EU's planned Carbon Border Adjustment Mechanism (CBAM) will require EU companies to establish carbon-neutral supply chains, which will incentivize African private sector entities to innovate and reduce emissions to maintain market access.

APA

Demissie, A., & Abimbola, O. (2023). The European Green Deal and the African Private Sector. Africa Policy Research Institute. https://afripoli.org/the-european-green-deal-and-the-african-private-sector

Chicago

Demissie, Alexander, and Olumide Abimbola. The European Green Deal and the African Private Sector. Africa Policy Research Institute, 2023. https://afripoli.org/the-european-green-deal-and-the-african-private-sector.

Wikipedia

{{cite report |last1=Demissie |first1=Alexander |last2=Abimbola |first2=Olumide |title=The European Green Deal and the African Private Sector |publisher=Africa Policy Research Institute |date=23 February 2023 |url=https://afripoli.org/the-european-green-deal-and-the-african-private-sector |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{demissie2023european, author = {Demissie, Alexander and Abimbola, Olumide}, title = {{The European Green Deal and the African Private Sector}}, institution = {Africa Policy Research Institute}, year = {2023}, month = feb, url = {https://afripoli.org/the-european-green-deal-and-the-african-private-sector}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }