LONDON, 19 July 2022 / PRN Africa / —
This project by the Growth Gateway explores green business opportunities between the UK and Africa, and how they could advance development impact.
Africa is one of the most vulnerable regions to the impacts of climate change (African Development Bank Group, COP 25, December 2019) despite having relatively low contributions to global emissions. It faces huge collateral damage posing substantial risks to its economies, food systems, and livelihoods. Important challenges that African countries face from climate change include:
the impact on food security and livelihoods from reduced agricultural production and productivity
the limited access to capital, technology and skills for economic adaptation and transition
limited governance and institutional capacity to deal with conflict over scarce resources and displacements arising from extreme climate events
While these challenges are severe, African countries have an opportunity to be an important part of the solution to the climate change challenge and contribute towards global Net Zero. This can be through unlocking the potential of renewable energy, climate smart agriculture and smart manufacturing, for instance. The UK, as a leading provider of green products and services, is in a strong position to help Africa seize the opportunity to build sustainable, green, inclusive and resilient businesses to drive the transition, which has become increasingly important in the context of climate change.
Green businesses do not contribute any negative impact on the environment, economy, or community. They use environmentally sustainable resources and uphold socially responsible policies (Harvard Business School, what does “sustainability” mean in business? October 2018).
Supporting the growth of such businesses has the potential to drive the creation of climate-smart jobs, boost economic growth and achieve sustainable development.
This short Growth Gateway project considered 8 topic areas and more than 30 sub-sectors within the broader green business space. Three dimensions were used to select focus sub-sectors:
– Africa structural advantage: is commercial potential on the continent already proven, or are the right conditions in place?
– UK comparative advantage: do UK firms have a strong right-to-play and right-to-win?
– impact potential: what is the potential environmental, social and economic impact?
Green trade and investment opportunities
From this overall landscape of over 50 opportunities, the project identified 8 high potential areas that have the clearest potential for UK-Africa trade and investment. These are mainly in clean energy, agriculture, and green financing spaces. Opportunities exist most notably in 6 countries – Nigeria, Ghana, Kenya, Ethiopia, Egypt and South Africa.
These opportunities tend to be less technologically advanced (eg waste reduction vs carbon emissions reduction), are at different levels of maturity and mostly in areas where Africa possesses a strong natural resource advantage. The environmental impact potential within the opportunity pipeline spans a wide range of outcomes from carbon emissions reduction, to strengthened adaptation and resilience, to waste reduction.
SOURCE UK Foreign & Commonwealth Office