The climate change crisis is pushing countries across the globe to accelerate their strategies to transition into greener economies. However, developing countries such as those within the Southern Africa region are challenged with the lack of resources to help them address this crisis. To create an environment where the fight against climate change can take place, these countries require adequate economic and social infrastructure.
This is where our efforts as the Developmental Bank of Southern Africa (DBSA) are critical in ensuring that we drive the development of all necessary infrastructure to equip the countries within the region with response capabilities and capacity. To learn more about our contributions to the greener economy fight, keep reading.
What is a green economy
A green economy is defined as an economic system which is friendly to the earth’s ecosystems and contributes to the alleviation of poverty. In the South African context, a green economy is viewed as “a path to sustainable development based on its potential to address interdependence among inclusive economic growth, social protection and natural ecosystems.”
Central to the green economy concept is the goal to produce and distribute goods and services, which are aimed at improving the well-being of humans over a long-term period while eliminating risks affecting the environment.
The challenges for the green economy transition
The transition to a green economy is not an easy one for developing countries that are already grappling with poverty, inequalities and resource deficit. The greatest challenge is access to green economy investment, which plays a catalytic role in the transition in key industries such as energy, transport, and health.
DBSA’s vision to a greener economy
The journey towards a low-carbon and resource-efficient trajectory is shaped by policy frameworks that seek to support the transition. And, over the years, the South African government has adopted a range of national legislation and plans in support of its vision of a greener and more sustainable economy.
Our role as the DBSA is to support the government’s commitment to contribute to a wide range of goals of transitioning to a greener economy. To achieve this, we developed a vision plan that aligns with the government’s vision. Our aim is to:
- Play a significant role in dealing with the challenges of climate change by advancing sustainable and environmentally friendly infrastructure solutions.
- Seek to advance sustainable and environmentally friendly infrastructure solutions.
- Continue to promote a greener economy, drive sustainability and development impact through our climate finance initiatives.
- Remain committed to supporting the government’s commitment to a just transition and meeting the Sustainable Development Goals (SDG) targets and commitments to Nationally Determined Contributions (NDC).
Green economy initiatives
Our vision is supported by several initiatives and programmes in our portfolio. These were established in collaboration with national and global, public and private sector and civil society partners who help create shared value in South Africa’s green economy transition and can help take green investments to scale. These initiatives and programmes include the Green Fund, Green Climate Fund, Climate Finance Facility, Embedded Generation Investment Programme and Renewable Energy Independent Power Producers Programme.
Our work through these initiatives and programmes has, thus far, created added value and developmental impact showcased below;
- Under the Green Fund portfolio, there are a total of eight development projects, 16 research and development projects as well as 31 investments projects in various stages of the project lifecycle.
- Under the Green Climate Fund portfolio, there are currently three active projects and six in the process of being prepared for consideration.
- The Climate Finance Facility de-risks and increases the bankability of climate projects in order to crowd in private sector investment. Its successful implementation will prove that similar financial models can be replicated in other developing countries.
- The EGIP programme has collected a total of $200 million to provide BBBEE funding to local communities, as well as small, medium and micro enterprises in renewable energy. This funding will also be used for the development of a new 330 MW generating capacity with the purpose of avoiding emissions of more than an estimated 700 000 tCO2 per annum.
- Through the REIPPP programme, we’ve invested a total of R12.4 billion in 14 projects, R2.5 billion of which was channelled into 9 BBBEE entities and 15 local community trusts.
To overcome the environmental risks brought on by climate change, we need to come up with environmental solutions that will have a sustainable developmental impact. Doing this ensures that the fundamental solution to environmental degradation will positively impact human lives and protects the future for next generations.
While there are many challenges throughout the transition period, a greener economy is also a possible reality for emerging economies such as South Africa. And, due to DBSA’s contributions and work as the government’s support system, all of the socio-economic development indicators are taken into account in the efforts of infrastructure development and socio-economic development aimed at addressing the climate change crisis.