Climate Change costing Africa billions: 2-5% of GDP spent yearly

African countries are losing between two and five percent of Gross Domestic Product (GDP) and many are diverting up to nine percent of their budgets responding to climate extremes.

The 2023 State of the Climate in Africa report launched Monday by the United Nations Economic Commission for Africa (ECA), the World Meteorological Organization (WMO) and the African Union Commission in sub-Saharan Africa, the cost of adaptation is estimated to be between US$ 30-50 billion annually over the next decade. That is between two and three percent of the region’s GDP.

The report presents a stark overview of the climate crisis facing the African continent and underscores the urgent need for increased investment in climate adaptation and resilience.

“Africa is uniquely vulnerable to climate change, with its high dependence on rain-fed agriculture and limited adaptive capacity. Rising temperatures, rising sea levels, and erratic rainfall are already causing widespread harm to human health, ecosystems, and livelihood,” said Minister of Green Economy and Environment of Zambia, Mike Elton Mposh.

“These challenges threaten to derail Africa’s big-bed progress towards achieving the sustainable development goals and the African Union agenda 2063. It is essential to continue advocating for increased investments in climate adaptation and resilience, particularly through the laws and dynamic priorities,” he added.

The Commissioner for Agriculture, Rural Development, Blue Economy, and Sustainable Environment at the African Union Commission, Ambassador Josefa Leonel Correia Sacko noted that the Report highlights the urgent need for action.

According to her, Africa faces disproportionate burdens and risks from climate change, which threatens food security, public health, and socio-economic development across the continent.

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In her presentation, Deputy Executive Secretary and Chief Economist at the ECA, Hanan Morsy said Africa is on the front lines of fighting climate change and its impacts, from rising temperatures to shifting rainfall patterns, and other extreme weather events.

“Consequently, key sectors like the agricultural sector, which employs over 60% of Africa’s population, are under threat. Crops are failing and livestock is suffering as climate variability disrupts traditional farming practices, jeopardizes food supply, and the economic stability of nations, which are already grappling with high poverty and levels.

“At the same time, African countries face significant debt distress, forcing trade-offs with critical development needs such as health or education. We can only drive investments in climate action if we have financing, therefore, there is a need to achieve sustainable debt levels to make the essential investments,” she further explained.

Morsy also observed that there must be a timely and sustainable international debt resolution that calls for an overhaul of the G20 Common Framework to make it more effective, time-bound and transparent.

She added that there should be a reform of the global financial architecture to ensure affordable financing at scale, the implementation of innovative financing instruments such as debt-for-nature swaps, and green and blue bonds.

She further recommended advancing carbon markets to establish a fair carbon price supported by high-integrity carbon registries to ensure transparency and trust. These, according to her, are transformative avenues to address Africa’s climate finance requirements.