ERA ENVIRONNEMENT: What were the main outcomes of the High Level Climate Finance Side Event ?
Jean-Pierre ELONG MBASSI: This event was about sensitizing and advocating for rooting climate action at the local level, where the bulk of green gas emissions are produced and where climate extreme events have the most adverse consequences. As the Vice President of UCLG Africa for the North Africa Region Dr Mohamed Boudra stated it in his introductory remarks, “the fight against climate change will be lost or won in cities and territories. Hence, it is important to involve local and regional governments as key players for climate action. In order to enhance the participation of local and regional governments in the implementation of the Paris Agreement and raise its ambition to limit global warming to a maximum of 1.5 degrees Celsius by the end of the century, one of the proposals put forward by the UCLG Africa Climate Task Force is to take advantage of the ongoing revision of the nationally determined contributions (NDCs) by the States parties to the United Nations Framework Convention on Climate Change for the implementation of the Paris Agreement, to better involve local and regional governments in climate action. In this respect, it is proposed that this revision starts with the locally or territorially defined contributions (LDCs) so that their consideration makes it possible to increase the ambition of the NDCs in the various countries. This bottom-up approach is likely to promote greater ownership and harmonization of the climate agenda at all levels of governance. It would possibly allow to develop agreements between the national government and local and regional governments for the implementation of NDCs action plans at both national and local and regional levels. This contractual process between the national government and local and regional governments for the implementation of the Paris Agreement represents a significant step forward in monitoring the implementation of the NDCs compared to the simple “shame and blame” procedure adopted in the Paris Agreement in the event of non-compliance by any State Party with the commitments it has undertaken.
ERA ENVIRONNEMENT: How it can happen?
Jean-Pierre ELONG MBASSI: One thing is to have locally determined contributions and local climate and energy plans, another one is to translate these plans into investment programs that are bankable and implementale. The side event specifically addressed this issue in two panel discussions: the first panel addressed the enabling conditions for local and regional governments to have the capacity to define bankable climate projects; the second panel that gathered mainly the financial institutions addressed the conditions to fulfill for local and regional governments to access climate finance. The conclusion was that the new narrative shall insist on the business and job opportunities created by the shift from high to low carbon economy, instead of highlighting mainly the difficulties and amount of money that this shift would require, which is so far the narrative put forward. The representatives of the banking sector present confirmed that the market is signaling the readiness of the business community to embrace a low carbon development pathway. They therefore confirm that they are ready to collaborate with UCLG Africa to better involve the financing of local and regional governments climate investments in their portfolios. They however pointed out that this will be done if and only if the public authorities show their resolve to embark on the green and circular economy. For example they indicated that a good sign would be to introduce carbon pricing as a clear indication of the will of the public authorities to privilege from now on a low carbon economy. It is therefore critical that all existing development plans be reviewed following the low carbon development perspective. Since 80 per cent of the resources needed to invest in the shift toward a low carbon economy will come from the private sector instituting a carbon price or taxation would send a clear message to the market and the business in favor of the shift from the old high carbon economy to the preferred low carbon economy.
ERA ENVIRONNEMENT: The West African Development Bank (BOAD) and UCLG Africa signed a Memorendum of Understanding (MoU). What does this MoU mean for cities?
The provisions of the MoU defined that the BOAD accepts to provide financial support for the operation of the UCLG Africa Climate Task Force and to grant UCLG Africa the status of implementing partner for its climate portfolio. On its part, UCLG Africa commits to mobilize the interest of local and regional governments to climate action and in particular the formulation of LDCs feeding into the process of NDCs revision. UCLG Africa will also assist BOAD to develop and implement a portfolio of local and regional governments climate projects, that could possibly benefit from the Global Environment Facility, the Adaptation Facility, and the Green Climate Fund which BOAD is an executive agency of.
ERA ENVIRONNEMENT: How will cities in Africa get access to climate finance especially the Green Climate Fund but also the Urban Municipalities fund from the African Development Bank?
Jean-Pierre ELONG MBASSI:One of the difficulties that local and regional governments encounter when talking about their access to climate finance is their possible inability to prepare bankable projects. The Mayor of Accra, Mohammed Adjei Sowah, responded clearly to this question in his statement during the first panel of the side event, saying that if it is limited capacity that impedes local and regional governments access to climate finance, then let’s address this capacity gap instead of agonizing about it. He therefore relayed the appeal sent by UCLG Africa that the national authorities and the international community accept to invest in a strong readiness program targeting the preparedness of local and regional governments to define bankable climate projects. The readiness program should also address the transparency and reporting system required by the climate finance institutions as conditions to fulfill in order to be able to access climate funds.
ERA ENVIRONNEMENT: Following the Africities Summit in 2018, how far has UCLG Africa gone with its Cities Finance fund introduced at the summit?
Jean-Pierre ELONG MBASSI:During the last Africities Summit we effectively held a meeting about the launching of a financial vehicle aimed at facilitating access of African local and regional governments to the financial markets. This vehicle also called the Africa Territorial Agency will have capital of 20 millions euros subscribed by a cooperative society of local and regional governments of Africa that will hold 50.1 per cent share of the capital, 33.3 per cent being held by the African Development Bank, and the remaining 18.6 per cent being sourced in the national and regional financial institutions. We are now busy affiliating members in the cooperative society, knowing that each local or regional government wishing to join the cooperative society shall pay 100,000 euros for the establishment of the cooperative society. Our target is to have 100 members in the cooperative society, which will result in the mobilization of 10 millions euros by end of 2019. We are also discussing with the African Development Bank that has been identified as the reference investor for the Africa Territorial Agency. The roadmap adopted for the implementation of the agency indicates that we should be hiring the manager of the agency by end of this year or beginning of next year 2020. The years 2020 and 2021 will be used to prepare basic studies for the governance of the agency, risk assessment, transparency and surveillance measures, and elaborating all the instruments needed to go to the market and to lend to local and regional governments. The first bond issuing is planned for the first quarter of 2022 and the first lending operation in the third quarter of 2022. Of course every effort will be made to support local and regional governments and build their capacity and ability to elaborate bankable projects, and to pool local governments requests in case the individual local or regional governments cannot reach the minimum threshold needed to tap into the financial resources of the market.
ERA ENVIRONNEMENT: What will UCLG Africa and its Taskforce hope to bring to COP25 ?
Jean-Pierre ELONG MBASSI: UCLG Africa wish to remind that the climate emergency that the UN Secretary General Summit in September 2019 highlighted very strongly. The COP 25 in Chile should take up this climate emergency and reflect on how to accelerate the implementation of the Paris Agreement as well as raising ambition in order to achieve the target of global warming limitation to 1.5 degree Celsius by the end of the century. As you know UCLG Africa pledges that the revision of the NDCs should start with the elaboration of LDCs as mentioned before. We want to include UCLG Africa among the members of the climate ecosystem , and to have local and regional governments as key stakeholders in climate action. UCLG Africa wishes also that the climate ecosystem include national associations of local and regional governments as implementing partners for all climate finance mechanisms and institutions including the Global Environment Facility, the Adaptation Facility and the Green Climate Fund. We also pledge for the definition of a strong capacity building program targeting local and regional governments in order to speed up the production of LDCs and their translation into a pipeline of climate investments projects, as well as the setting up of a measuring, reporting and verification system defined at the local level, that is aligned with the national and global Mesuring Reporting and Verification (MRV)) system. We will be also partnering with members of the UCLG Africa Climate Task Force and organize a series of side events on issues of interest for African local and regional governments in the area of climate change.