Facilitating Green Growth in Africa Perspectives from the African Development Bank Rio de Janeiro, June 14, 2012 ______

1. FacilitatingGreen Growth in AfricaPerspectives from the African Development BankRio de Janeiro, June 14, 2012______ Frank Sperling Energy, Environment and Climate Change Department Green Growth Team African Development Bank

2. Part 1: Rationale for Green Growth in Africa Green Growth represents a transformative development model for enabling sustainable growth and creating prosperity in Africa by taking a holistic approach to development, which: • values human, social and natural capital, • efficiently and sustainably uses ecosystem goods and services, and: • builds resilience in a changing and increasingly inter-connected world

3. The Global Perspective on Green Growth On a global scale the rationale for green growth is clear. Humanity has become the dominating force shaping the surface of the planet, altering major biophysical processes from local to global scales. Renewable resources are being utilized at faster rates than they can be replenished. Consequences: • Overexploitation of natural resources, loss of biodiversity • Waste Accumulation • Pollution • Climate Change etc. • In light of population growth, continuing with BAU is not an option. Need to adjust our economic model in recognition of the physical boundaries of the planet and social justice. Sources: Crutzen 2002, MEA 2005, IPCC 2007, Zalasiewicz et al 2008, WWF 2010, Raworth 2012

4. Green Growth in the African Context Sources: AfDB et al. 2012, WWF and AfDB 2012

5. Consequence Green Growth needs to be development centered, relating to key development challenges: • Overcoming the infrastructure deficit • Efficient Management of Natural Resources • Natural Disasters and Climate Change • Food Security

6. Issue: Energy Access and Security • Development requires energy • Decisions taken today will lock-in Africa’s energy infrastructure for decades

7. Issue: Population Growth Issue: Land degradation Land degradation affects large parts of Africa.

8. Issue: Economic Risks Issue: Climate Change Figure. Most of Africa’s crops are likely to be adversely affected by climate change: Projections for 2045-65 relative to 1961-2000. Source: Schlenker and Lobell 2009 Figure. Changes in world price’s for key African agriculture exports during 2012.

9. Green Growth is a transformative, iterative process leading towards greener economies Ecological footprint X1 GDP per capita X2 Time

10. Green Growth: It is about adapting to changing realities for development, but also about seizing new opportunities: Leap-frog to efficient technologies when addressing Africa’s infrastructure deficit Manage Africa’s new asset – carbon, recognizing the growing importance of Africa’s natural wealth to the world Harness the demographic dividendthrough education and skills development Leverage growing private-sector development through clear regulations and incentives

11. Part 2: Transitioning to Green Growth Green Growth is a iterative process. It is a about identifying options that enable the transition towards sustainable development pathways.

12. Steps (1) • Vision/Buy-In: Strong political leadership at highest level, cross-sectoral focus, early stakeholder engagement • Valuing What Matters: Focus on quality of growth, national accounting of economic, social and natural capital • Planning for the Future: Avoiding lock-in of unsustainable development pathways

13. Steps (2) • Sending the right signals: Engagement of private sector is crucial; requires clear regulatory environment, policy incentives • Financing: Many interventions result in cost savings over project life time, increasing efficiency and productivity, but upfront investment costs may present obstacles for transition. For green growth options with global benefits appropriate contributions from international community are needed.

14. Part 3: Building on Experience AfDB and other development organizations can build on existing policy, operational and financing experience that can function as building blocks for green growth development pathways.

15. Project Examples: Alternative Pathways to Energy Security (1) • In Kenya, where only 5 percent of the rural population has access to electricity, the Menengai geothermal energy project will enable a 26 percent increase in production capacity by 2018. This additional reliable, clean and inexpensive electricity will meet the needs of 500,000 new households and 300,000 small businesses and will provide 1,000GWh to industries. • AfDB’ssupport for South Africa’s national electricity utility, Eskom, in implementing a $1.3 billion renewable energy project is introducing concentrated solar power to sub-Saharan Africa and the first utility-scale wind power plant to South Africa (100MW each). Source: AfDB Staff

16. Project Examples 2: Strengthening productivity and food security through sustainable land and water management Drier agro-ecological conditions in the Gambia have led to declining productivity in arable areas where major food crops are grown. By investing in a system for improved soil and water management (PIWAMP), the AfDB has contributed to a six-fold increase in total crop production in the project area—from 4,000 to 25,000 metric tons a year between 2006-2010. Source: AfDB Staff

18. Concluding Remarks • Green growth is not a departure from sustainable development, but reinforces the need to address the social, economic and environmental dimensions of development; • Green growth places further emphasis on growth as a central driver of development, while focusing on the most environmentally sustainable options; • It requires sustained political commitment, better valuation of natural and social assets in decision-making processes, and removing market distortions;

19. Concluding Remarks (2) • Green Growth strategies need to be tailored to the development context of a country; • While not every puzzle piece in a country’s economic picture can be green, over time the pieces can come together to create a green picture; • AfDB stands ready to assist its Regional Member Countries in developing Green Growth Strategies, securing financing and technical assistance.

20. Thank you. Merci. • The AfDB’s strategic work on Green Growth is carried out by a cross-sectoral team. • Co-chairs are: • Mr. AlyAbou-Sabaa, Director and Chair of the Climate Change Coordination Committee • Mrs. HelaCheikhrouhou, Director of the Energy, Environment and Climate Change Department • For further information and feed-back, please contact: • Frank Sperling, Green Growth Team Leader, f.sperling@afdb.org The views expressed in this presentation do not necessarily reflect the views and policies of the African Development Bank (AfDB) or its Board of Governors or its Board of Directors or the governments they represent.