According to the African Development Bank (AfDB) Groupwebsite news release on November 11, 2022, the Egyptian government has launched the Sharm El Sheikh Guidebook for Just Financing at a roundtable event held 10 November during COP27.
The guidebook(link is external) was produced jointly by the Egyptian Ministry of International Cooperation and more than a hundred development partners, corporations, development finance institutions and non-profit organizations. These include the International Monetary Fund, Rockefeller Foundation, the World Economic Forum, Climate Investment Funds and Citi, the banking group.
The publication posits that climate financing should complement rather than replace development financing, guaranteeing that countries and regions that most need climate financing are able to access it.
It aims to support creation of an international framework that will help African countries to tap green financing more effectively, particularly against a backdrop of budget deficits linked to responses to the Covid-19 pandemic and soaring prices for energy and food.
The Egyptian Minister for International Cooperation, Rania Al-Mashat, said, “The question of financing has become central in view of the devastating effects of climate change. Worsening repercussions of the Covid-19 pandemic and the Russia-Ukraine conflict mean that developing countries and emerging economies are more than ever in need of specific financing, which is essential in order for them to continue their climate action.” She added, "This new guidebook identifies an international framework that promotes an equitable distribution of climate financing, particularly in favour of African countries."
Dr. Akinwumi Adesina, president of the African Development Bank Group, said: “Climate change is the greatest threat faced by humanity today. It places a heavy burden on the World's poorest and most vulnerable people. It distorts landscapes, ruins populations and threatens the lives of billions of people every day. In this context, the Guidebook offers an excellent opportunity to focus attention on the financial needs of the countries which are most vulnerable to the effects of climate change, without diversion of their development financing or increase of their debt.”
He said the African Development Bank was pleased to have contributed to its preparation and remained committed to supporting its implementation. “We are backing up knowledge with action: our climate financing has increased from 9% in 2016 to 41% last year,” Adesina added.
The guidebook calls on international climate actors to take account of historical disparities in the distribution of climate financing between countries. It also defines the concept of just financing in the structure of international climate financing and the creation of a mechanism to provide it. It also recommends that such funding be concessional in nature and tailored to the budgetary requirements of countries.
It also stresses the need to put an effective governance system in place, with rules that encourage the establishment of green markets, and highlight the importance of an effective monitoring and evaluation system and new coordination mechanisms between countries and key stakeholders.
