As the inaugural Africa Climate Summit got underway on Tuesday, Kenyan President William Ruto said there is a price to be paid for economic success and that a worldwide tax on carbon emissions may help raise Africa’s historically low Gross Domestic Product (GDP) rates.
In a proclamation released on November 1st, African leaders laid out their negotiation stance for the next COP28 session regarding additional global levies and changes to international financial institutions to help finance action against climate change.
Discussions on mobilizing funds to adapt to more harsh weather, protect natural resources, and create renewable energy dominated the three-day Africa Climate Summit in Kenya, culminating in the Nairobi Declaration.
Researchers estimate that Africa requires over $300 billion per year to adapt to the effects of climate change but is only receiving approximately $12 billion.
Although the organizers highlighted carbon credits and other market-based solutions before the summit, the final declaration placed a greater emphasis on demanding that large polluters and international financial institutions provide more aid to poorer nations and make it easier for them to borrow at affordable rates.
According to the report, if such procedures were implemented worldwide, it would guarantee massive finance for climate-related projects and shield the subject of tax hikes from geopolitical and internal political pressures.
The International Monetary Fund (IMF) estimates that over two dozen nations have some kind of carbon price in place, but a worldwide carbon tax has never really taken off.
On Tuesday, Kenyan President William Ruto said that the EU’s proposed financial transaction tax (FTT) may serve as a template.
African nations claim they cannot invest more in adapting to climate change because they must pay financing prices that are five to eight times greater than those of wealthier countries.
The statement requested “improved use” of the IMF’s unique drawing rights mechanism and encouraged international development banks to enhance concessional financing to poorer nations.
Instruments that may give 10-year grace periods and prolong sovereign debt tenors were also proposed to assist indebted nations in avoiding default.
Critics of the summit argued it should have given more attention to helping Africans prepare for and deal with catastrophic weather.