Financing Adaptation in Africa: The Key to Sustainable Development

This policy brief by the South African Institute of International Affairs argues that scaling up adaptation finance is critical for Africa's sustainable development, as the region is highly vulnerable to climate change despite low emissions. It identifies significant funding gaps and barriers—including a lack of 'bankable' proposals and a perception that adaptation projects lack private sector viability—and proposes several innovations to attract both public and private capital.

• Africa is disproportionately vulnerable to climate change, with seven of the ten most vulnerable countries located on the continent, despite the region contributing only 5% of global greenhouse gas emissions.
• There is a significant gap between the financial needs for adaptation in Africa and the actual flows. The African Development Bank estimates an annual need of $7–15 billion, yet sub-Saharan Africa received only $3.57 billion of the $13.9 billion in adaptation finance committed to low- and middle-income countries according to a 2019 MDB report.
• Adaptation finance consistently lags behind mitigation finance at both global and national levels. For example, in 2018, 78.9% of climate finance in Kenya was directed toward mitigation, while only 11.7% went to adaptation.
• Private sector investment in adaptation is hindered by the perception that these projects are public goods with no business case, and a lack of clear models for costs and returns. Consequently, the private sector contributed only 1.6% of global adaptation finance in 2017–2018.
• African governments face technical barriers in accessing multilateral climate funds, specifically a lack of skills to create 'bankable' proposals and a lack of access to or capacity to interpret the climate data necessary for a strong project climate rationale.
• The document proposes several mechanisms to increase adaptation finance, including the introduction of 'adaptation levies' (citing Fiji's Environment and Climate Adaptation Levy as a model), lobbying for an international adaptation finance goal distinct from general climate finance, and encouraging MDBs to achieve parity between adaptation and mitigation funding.
• Investing in early warning systems and resilient infrastructure offers high returns; the Global Commission on Adaptation suggests that a $1.8 trillion global investment between 2020 and 2030 could yield net benefits of $7.1 trillion, with a benefit-cost ratio between 2:1 and 10:1.

APA

South African Institute of International Affairs (2021). Financing Adaptation in Africa: The Key to Sustainable Development. https://saiia.org.za/research/financing-adaptation-in-africa-the-key-to-sustainable-development/

Chicago

South African Institute of International Affairs. Financing Adaptation in Africa: The Key to Sustainable Development. 2021. https://saiia.org.za/research/financing-adaptation-in-africa-the-key-to-sustainable-development/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=Financing Adaptation in Africa: The Key to Sustainable Development |date=28 October 2021 |url=https://saiia.org.za/research/financing-adaptation-in-africa-the-key-to-sustainable-development/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2021financing, author = {{South African Institute of International Affairs}}, title = {{Financing Adaptation in Africa: The Key to Sustainable Development}}, institution = {South African Institute of International Affairs}, year = {2021}, month = oct, url = {https://saiia.org.za/research/financing-adaptation-in-africa-the-key-to-sustainable-development/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }