In a groundbreaking move, the United Arab Emirates announced a substantial investment of $4.5 billion in Africa’s clean energy sector.
The announcement was made during a climate summit hosted by Kenya, which sought to attract funding for initiatives aimed at combating global warming.
Spearheading this investment is Sultan Al Jaber, the head of Masdar, a government-owned renewable energy firm, as well as the UAE’s national oil company, ADNOC, and the COP28 climate talks. Al Jaber stressed the importance of this investment, stating, “If Africa loses, we all lose.” He went on to explain that the goal is to develop 15 gigawatts of clean power by 2030 and to catalyse an additional $12.5 billion from various sources, including multilateral, public, and private funding.
This investment comes as Africa hosts the Africa Climate Summit, where heads of state, government officials, and industry leaders have gathered to discuss and promote Africa’s potential as a clean energy powerhouse. The summit aims to define a shared vision for green development on the continent, which is home to 1.4 billion people.
Currently, Africa’s renewable generation capacity stands at 56 gigawatts, according to the International Renewable Energy Agency. With the UAE’s significant investment, this capacity is expected to grow exponentially in the coming years. The investment will serve as a critical boost to the continent’s clean energy sector, enabling the development of bankable projects that will contribute to the fight against climate change.
Beyond its positive environmental impact, this investment is also expected to generate economic opportunities in Africa. The development of clean energy infrastructure will create jobs and stimulate economic growth in local communities. Moreover, the investment will attract further funding from various sources, unlocking additional financial resources for Africa’s sustainable development.
During the summit on Tuesday, proposals will be presented to reform global financial structures that have disproportionately allocated investments in climate solutions away from Africa. Jaber emphasised the need for targeted and precise changes to the outdated global financial architecture, with a specific call for institutions to alleviate debt burdens.
Despite the continent’s abundance of natural resources, African countries are severely constrained by escalating debt expenses and limited access to finance. Shockingly, only three percent of energy investments worldwide are channelled into Africa.
This highlights the urgent necessity for a comprehensive revamp of the financial system to address these disparities and ensure equitable distribution of resources for climate initiatives in Africa.