Enhancing the private sector’s readiness to deliver climate change outcomes in Southern Africa
The Southern Africa Climate Finance Partnership has released a working paper outlining how the private sector’s response to climate change can be enhanced in four countries: Botswana, Lesotho, Namibia and Zimbabwe.
The working paper entitled ‘Enhancing the private sector’s readiness to deliver climate change outcomes in Southern Africa’, outlines the roles that the private sector could play within these case studies to safeguard against the risks of climate change (e.g. water scarcity within a business’s supply chain). It also explores the potential business opportunities climate change creates for the private sector (e.g. exploring renewable energy and energy efficiency solutions within business models). The report builds on from a previous diagnostic paper that focused on South Africa and used a similar research methodology and approach.
The working paper offers a global overview of the rise of climate finance as a source of development finance that can be used within the private sector to respond to climate change adequately. At a national level, within the four countries of focus, the working paper tells a story about the need for a common language and understanding of climate change impacts and opportunities for the local private sector. The initial comprehension of the risks and opportunities that climate change presents is crucial for businesses to position their response measures. Building on from this understanding is the need for leadership within the organisation to drive a strategic approach in response to the potential risks and opportunities.
Across all countries, there is significant potential to scale up the role of the private sector in the delivery of this ‘climate investment’. The working paper undertakes a country by country analysis to see where climate change is creating different opportunities and risks for the private sector in Botswana, Lesotho, Namibia and Zimbabwe. Four key messages emerged across all four countries:
- Firstly, that these countries have made great progress in creating enabling environments that support private sector investment in renewable energy. However, the development of energy efficiency, climate-smart agriculture and adaptation tend to be less advanced.
- Second, while technocratic changes such as new policies, incentives and regulations are likely to be crucial, they need to be complemented by support to build (aspects of) the capacity of the private sector in all countries.
- Third, access to finance remains a considerable challenge, which makes enhanced engagement with international climate finance providers like the Private Sector Facility of the Green Climate Fund a priority. The working paper seeks to guide practical local measures that can respond to the Green Climate Fund’s Private Sector Facility’s report entitled ‘Driving the transformation to a climate-resilient financial system’.
- Finally, as one of the early studies looking at the role of the private sector in accessing and delivering climate finance within the region, there are several opportunities to enhance and refine this work. The working paper is intentionally not “complete” as strengthening the private sector’s responsiveness will continue to be one of many elements required to drive local economic development in the context of the risks and opportunities presented by climate change. In this way, the discussion will continue to be an emergent one and an area to which we hope this paper will be able to contribute.
This research intends to be an initial analysis across four countries to enhance the coordination of the private sector’s collective response to climate change. Along with the South African case, it makes a collection of five country case studies across the Southern Africa region.
The intention is for the Southern Africa Climate Finance Partnership to continue to deepen the conversation which explores practical ways in which knowledge can be brokered between private sector actors and government stakeholders to enhance the response to climate change.