Africa Finance Corporation CEO Samaila Zubairu weighs in on the critical climate debate

Emerging markets need $1trn a year in climate finance to achieve 2030 climate goals. The reality is they are receiving just $150bn a year. The Africa Finance Corporation recently launched a white paper on climate change. AFC president and CEO Samaila Zubairu weighs in on the critical climate.

On whether Africa features on the global stage at the World Economic Forum in terms of solutions to key issues

Davos is a good platform for engagement. I think it is a good platform for Africa to project itself differently. It’s a good platform for Africa to present itself as an investment destination and as a solution provider or as part of the solution for the energy transition. That is mainly because we will need a lot of minerals and metals for the energy transition. Most of them are in Africa. We need to mine them sustainably and process them in an energy-efficient manner. We need to look at it in the context of our wider aspirations for a continental free trade area. So, we must put all of this together and engage with the world on how to build local circular economies in Africa that will reduce the emissions from global shipping as part of our solutions to climate change. We have to look at how we can build this talk of goods for trade within the continental free trade area. We need to think of how we can build the infrastructure to support the continental free trade area and how we can create more jobs for Africans. I believe this is a good forum for us to collaborate with existing partners and new partners for that. 

On solutions to combat climate change

We recently launched a climate white paper, and the whole idea is to try and build a consensus of African leaders around a common narrative of Africa for engagement with the world at COP27. We are trying to project four key messages. The first is that Africa is in a unique position where the least contributors get the most impact, and that because we are already very low on the emissions scale, nothing will be gained by giving us similar targets to the rest of the world. They are more prosperous nations. And because we already have significant forests that absorb most of the carbon, you know, emissions have no borders. So, we are already absorbing most of the carbon emissions. We need to do things differently and those areas for change are in three areas. Number one: how do we build local circular economies that will do the processing of the minerals and methods required for the energy transition in a sustainable manner? Two: how do we build resilient infrastructure that will make us withstand the impacts of climate change? Three: how do we financially innovate in a way that we can get the flows of pledges and generate internal funding from Africa because Africa actually has some funds? How can we propose some of that for these investments required to build resilient economies, support energy transition, preserve the forests the world needs, that will develop our natural gas. That should be a transition form on our mat and our part to nazio, as well as compensation for African communities that are already providing carbon sinks for the rest of the world.

On Africans without access to electricity or clean fuel

That number has increased with Covid-19. So, what we now know is that 80% of the people without access to electricity in the world live in Africa. The use of charcoal and firewood is something the world should work with Africa to discourage. And we can only discourage that by providing alternatives such as LPG and other modern cooking methods. It is something we should do. We are at the forefront of that, and we believe we need to continue to execute those projects and build a partnership that would make us do more projects. Because all of these initiatives can be replicated, at scale, on the continent with additional capital and additional partnerships. That is what we hope we can achieve with Davos. 

On the medium- and long-term vision for African Finance Corporation

We want to be the enabler for industrialisation in Africa. We want to provide a structure that will support industrialisation in Africa. We believe Africa needs to transform itself from merely exporting primary commodities to exporting and providing finished products for consumption in Africa. The control free trade is going to be a significant opportunity for Africa, but we don’t want imported goods sold in that free trade area. We want African goods. So, our focus now is to build platform companies that would focus on one: building the renewable energy required for the future, building the minerals and metals, processing them for the energy requirements and the mobility requirements of the future. So, we are looking at a royalties streaming company for both precious metals as well as for transition metals. Precious metals are important because Africans need to build on their resilience. We have significant gold here, and need more of that gold as a mix of our foreign reserves. I want Africans to use African gold for that. So, we are investing in gold mines and we think African governments should take a position in those gold mines. We are building our post and logistics platform. Currently, we have five ports. We want to increase those ports as those ports would be a gateway to support both intra-African trade and trade with the rest of the world. We are focused on industrial platforms whereby we are looking at integrated value chains and how we can provide more value capture in Africa.

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