The African Development Bank and the Green
Growth Knowledge Platform (GGKP) have been awarded a two-year, CHF 241,875
($273,439) grant from the MAVA Foundation to mainstream natural capital in
development finance in Africa.
MAVA, a philanthropic foundation, promotes the conservation of
biodiversity and advocates for sustainable economies in the Mediterranean, West
Africa and Switzerland.
The grant will support activities to develop a business case for natural
capital among multilateral development banks, scale up the application of
natural capital in infrastructure finance, integrate green growth and natural
capital in African sovereign credit ratings, and build the capacity for
adoption of natural capital approaches in decision-making through a Natural
Capital Academy.
Natural capital is the stock of renewable and non-renewable natural resources,
such as plants, animals, air, water, soils and minerals that combine to provide
benefits to people and support life.
Nature-based solutions are emerging as essential climate-change mitigation
and adaptation strategies in Africa, with a growing recognition that protecting
ecosystems could provide at least a third of the climate mitigation needed by
2030 under the Paris Climate Agreement.
Vanessa Ushie, Manager of the Policy Analysis Division in the African Natural
Resources Centre of the African Development Bank, noted that: “the natural
capital mainstreaming initiative offers a strategic opportunity for the AfDB to
embed nature and natural capital at the heart of decision-making on development
planning, investments, and infrastructure finance in Africa.”
The case for centering natural capital in investment decisions on the continent
is clear. In most African countries, natural capital accounts for between 30%
and 50% of total wealth. In sub-Saharan Africa, over 70% of people depend
on forests and woodlands for their livelihoods.
Through its strategic frameworks such as the High 5s and Ten-Year Strategy
(2013-22), the Bank has prioritised the management of Africa’s natural
resource assets to foster inclusive growth and the transition to green growth,
recognizing the fundamental role of natural capital in meeting its regional and
global ambitions on climate, biodiversity and sustainable development.
The vision for this grant is to crowd-in additional resources to complement
existing interventions on natural capital. The Bank and GGKP will jointly
administer the grant and coordinate implementation of project activities under
an existing bilateral partnership and established technical cooperation. The
Worldwide Fund for Nature (WWF), a major implementing partner, will deliver
specific components and activities.
The Bank’s engagement in the initiative cuts across various departments and
complexes working on infrastructure development, energy, climate and green
growth, sovereign risk and investment, capacity development, and is being led
by the Bank’s African Natural Resources Centre. The initiative is
particularly relevant as Africa looks ahead to the post-COVID-19 era.
“For Africa to build back better after COVID-19, new investment models and
practices that promote a better use of the values provided by natural capital
will be critical to engendering a green recovery,” Ushie said.
The project involves the participation of a broad range of multilateral
partners which will play technical advisory and complementary roles. These
include the International Institute for Sustainable Development (IISD), the UN
Environment Programme (UNEP), the German Federal Ministry for Economic
Cooperation and Development (BMZ), the German Development Agency
(GIZ), Capital Coalition, Economics for Nature (E4N) and the Green Economy
Coalition.
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