Climate summit puts spotlight on debt trap behind green loans

For decades, residents of northern Kenya have endured harsh climatic conditions due to climate change. [File, Standard] When Africa's leaders gather in Ad dis Ababa this week for the Second Africa Climate Summit, th e headline theme will be financing. Beneath that, however, lies a sharper d emand - linking climate justice with debt reform. Africa loses five per cent of GDP annually to clim ate d isasters. At the same time, many countries pay more to service debts than to fund health or education. New climate finance, offered m ostly as loans, only deepens t his trap. Former Mauritian President Bibi Ameenah Firdaus Gurib-Fakim s aid: "Debt reform can no l onger be separated from climate reality." She is part of the African Leaders' Debt Relief Initiative, which has pushed creditors and multilateral institutions to integrate climate risks into lending frameworks. Her message is gaining traction. Civil society, economists, and nego tiators say Africa cannot meet its $3 trillion (Sh390 trillion) climate goals while chained by old debts and new ones. The paradox runs deep. Africa contributes less than four per cent of global emissions but faces escalating shocks, drought in the Horn, floods in West Afric a, cyclones in Moza mbique. The World Resources Institute estimates the continent will need $579 billion (Sh75 trillion) for ad aptation between 2020 and 2030. Current flows are just a fraction of that. Worse, they arrive slowly, in complex forms, and domin ated by loans. This comes on to p of debt burdens that have gro wn with rising in terest rates and inflation. By 2024, more than half of African countries were either in debt distress or at high r isk of it. Clima te shocks only make repayme nt harder. As Gurib-Fakim argued, Africa already provides trillions in free ecosystem services tha t stabilise the planet. "Afr ica, with its vast resources, youthful population, and immense growth po t ential, should be shaping the rules of global finance, not merely reacting to them," she said. The Nairobi Decl aration in 2023 called for massive renewable invest ment and industrialisation powered by clea n energy. Two years later, that ambition remains strong. Addi s will h ost more than 45 heads of St ate and deliver the Addis Ababa Declaration on September 10. But the urgency has shifted. Leaders now stress that scaling renewables, building resilience, and protecting communities cannot happen without changing how the world finances Africa. Ambassador Ali Mohamed, Kenya's climate envoy, said: "Our charge is clear to tran sform ambition into action by scaling capital , un locking val ue chains, and forging alliances that anchor Africa's competitiveness in the global green economy." Scaling capital means changing the rules of the game. Adaptation flows today are five to ten t imes below Africa's needs. And most of that is de bt. This is why African negotiators a re pressing for a financing order that p rioritises grants, concessi onal loans, and instruments that do not pile onto existing burdens. Dr Richard Muyungi, Chair of the Africa n Group of Negotiators on Clim ate Change and Spe ci al Envoy to the Pres ident of Tanzania, warned that Africa is on the frontline of the crisis, with food securi ty, water access, and development already under severe strain. He said commitments from the Paris Agr eement and other diplomacy corridors rema in far below what is needed, while adaptation finance is "inadequate, un predictable, and loan-heavy, worsening debt distress ." They also want creditors to recognise climate vulnerability in deb t restructuring talks. The logic is direct: climate shocks increase repayment risk, so they must b e factored into framework s. Ethiopia's Planning Minis ter Fitsum Assefa backed the push: "Unlocking Africa's potential requires shedding outdated perceptions of Africa as high-r isk and i nstead recognising the continent as central to a stable c limate and equitable g lobal economy." At COP29 in Baku, developed countri es pl edg ed $300 billion annually under the new finance goal. Afric a's negotiators cal led i t insufficient. They argue that $1.3 trillion is nee ded, with at least $3 trillion required for Africa's full climate response. Civil society groups warn that unless weal thy natio ns d el iver real resources in the right form the continent will be forced to choos e between climate surv ival and debt repayment. That is no choice at all. Ethiopian Prime Minister Abiy Ahmed, hosting the summit, stated: "Africa seeks not charity, but justice; not pity, but partnership." The debt-climate link r esona tes beyond go vernments. Communities on the frontlines often se e little of international pledges because funds are tied up in bureaucracy or debt service. Take Mozambique. After back-to-back cycl ones , it r equired billions in reconstruction. Yet high debt levels restricted its capacity to respond. Simi lar stories repeat in Mal awi, Zambia, and Ghana. Analysts say this prove s the point: climate finance without debt reform only creates new traps. The Addis Ababa Declaration is expected to stress justice-centered finance. Observers will watch if it calls explicitly for debt cancellation, concessional finance, and integration of climate ri sks into multila teral de bt frameworks. It may also push for Africa's renewa ble energy plan scaling to 300 GW by 2030 to be financed throu gh innovative tools that avoid new debt. Mohamed Adow, Power Shift Africa Executive Director urged: "This summit must resolve the paradox of lack i n abundance. If ACS2 can renew our commitment to Agenda 2063 and plan for its implementatio n, it will have exceeded expectations." The Addis summit i s a moment of re ckoning. Either the wor ld recognizes that debt reform is a prerequisite for climate resilience, or Africa's ambitions will remain aspirations. For many African leaders, the choice is clear. As Gurib-Fakim said, linking debt justic e with climate resilience is not just about Africa. "Africa's stability will be a force for good for the entire world." That message will echo from Baku to Addis this week and on to Belem for COP30.

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