Rich countries' aid to West Africa to cope with climate change is insufficient and dangerously worsening debt levels

Rich countries and multilateral donors have so far mobilized only 7% of the estimated $198.88 billion that West African countries need by 2030 to cope with the climate crisis and pursue their own green development.

According to a new Oxfam study today, Climate Finance in West Africa, 62% of $11.7 billion declared by donors between 2013 and 2019 have been mostly in the form of loans, which will have to be repaid, many with interest, aggravating the debt crisis in most West African countries.

Climate finance is a highly-contentious issue that again threatens the success of the crucial UNFCCC climate talks in Egypt this November. Oxfam and a hundred African civil society organizations are concerned that African countries will come to the summit with little confidence that donors will honor their repeated promises to mobilize 100 billion a year for climate action in developing countries (a target that has been missed by $16.7 billion in 2020).

These organizations are calling on rich countries - historically responsible for climate change - to assume their fair share to help the region face the escalating climate crises that has hit the African continent.

The report warns that rich countries are increasingly using loans to help West African countries cope with climate change. Between 2013 and 2019 loans have increased by 610% from $243 million to $1.74 billion. By comparison, grants have only increased by 79%. Among the donors that have made the most use of loans as a proportion of their total climate financing are the World Bank (94%), France (94%), Japan (84%), the African Development Bank (AfDB) (83%) and the European Investment Bank (EIB) (79%).

"At a time when West Africa is reeling from multiple crises including climate, hunger, and security, these financial flows are grossly inadequate and not what was promised. Many of these are now loans that actually reduce countries’ capacity to cope. Most countries are falling into a spiral of debt and poverty, which runs counter to the spirit of climate justice. The consequences are disastrous for millions of people who are paying the price for the impacts of climate change yet not responsible for it," said Assalama Dawalack Sidi, Oxfam's Regional Director for West and Central Africa.

The consequences on debt and the capacity of countries to provide basic services to populations facing multiple crises are very real. For example:

• Although Niger (7th most vulnerable country in the world to climate change), Mali (13th most vulnerable), and Burkina Faso (24th most vulnerable) all face a risk of debt distress, they have received a sizable share of climate finance in the form of loans and debt: 51%, 43%, and 41%, respectively. These countries are already being pushed into a new wave of austerity measures by the IMF and are planning combined budget cuts of $7.2 billion by 2026 which will further limit their ability to invest in quality public services and protection for their citizens.
• Ghana currently receives 40% of its climate finance in the form of loans and debt, despite already being at high risk of debt distress. In 2019, Ghana was spending 55 times more on debt servicing than on agriculture. It is planning a $23.3 billion budget cut by 2026.

Oxfam believes that funding in West Africa should focus on adaptation measures, rather than mitigation given the region is a very low contributor to global greenhouse gas emissions. However, there is an 82% gap between the adaptation funding reported in 2019 and the needs expressed by West African countries.

Chad, the world's most vulnerable and least prepared country for climate change, has the largest funding gap for adaptation with 95% of its financial needs not covered ($1.47 billion of $1.57 billion per year) by 2030.

These findings are all the more alarming given that hunger is increasing at an unprecedented rate in the region, in part driven by droughts that are becoming more frequent and severe as rainfall becomes more erratic and unpredictable. There has been a 154% increase in the number of people now food insecure between March-May 2022 compared to the five-year average between 2017-2021.

"We demand that all donors urgently increase their climate financing and honor their promises. These funds must be disbursed as grants not loans and must respond to the priorities and adaptation needs of recipient countries and their communities," said Sidi.

The report's recommendations support the recent joint statement by two dozen African leaders meeting earlier this month at a forum in Cairo, where they urged the richest countries to uphold their aid pledges so the continent can tackle the effects of climate change for which it shares little blame.

The report is being published ahead of citizen caravans organized by about 100 African civil society organizations, including Oxfam, that will travel across 23 countries on the continent to Egypt. The caravans will mobilize communities and policy makers along the way to highlight the harm that climate change is causing to Africa and demand more justice in climate finance.

"As Africa heats up, African communities’ temperature is rising too. Today, people are uniting to demand more climate justice. The international community, and rich donors in particular, must urgently hear their cries," said Sidi.