By Jeff Kapembwa
To fight and build climate-resilient infrastructure and transition to clean energy by 2030 as espoused under the Sustainable Development Goals (SDGs), Africa should strive to raise a staggering US$1 trillion annually to insulate.
Africa has waged a relentless war against the climatic crisis. This is despite being rated 9th of the 10 countries perceived as the ‘most vulnerable continent to climate change’ and this is despite emitting a paltry 4 degrees of the total emissions.
The continent has been dogged by various shortcomings hindering its ascension to SDGs including widening in development financing caused by tightening external capital flows, climate campaigners say.
Other hazards affecting the continent’s fight against the temperature driven crisis include high sovereign debt, and climate vulnerability. The massive annual funding deficit—nearly half of which represents an external gap—is driven by several fundamental factors: Extreme Climate Vulnerability.
During the just ended 61st second AfDB Annual meeting of the AfDB hosted by Congo Brazzaville and attracted various interest groups including cooperating partners, a staggering US$1.3 trillion is the financing shortfall to allow the continent meet various obligations.
There is an urgent call for all countries to push funds in one basket and raise over US$1, 3 trillion to build climate-resilient infrastructure and transition to clean energy and insulate itself.
The setbacks stunting growth on the continent include; a weak Domestic Revenue Mobilization framework, spurred by the continent’s narrow tax bases and lose significant capital through illicit financial outflows.
This shortcoming, makes it difficult for states to collect sufficient revenue to fund public services independently. The Rising Debt Servicing Costs is another factor that is thwarting growth prospects.
According to a final communique at the end of the meeting held from 25-29 May and dubbed; “Mobilizing Africa’s Development Financing at Scale in a Fragmented World,” teh meeting regretted the increasing commercial borrowing and rising global interest rates that have made refinancing debt much more expensive.
Debt servicing is absorbing resources that could otherwise be used for education, healthcare, and poverty alleviation. There is lack of sustained Private Investment. This is despite being one of the fastest-growing regions economically over the last two decades.
Africa, analysts say, attracts a disproportionately small share of global foreign direct investment and venture hence the call to step up domestic resource mobilisation and patch up the financial deficit buffeting the continent.
Africa’s total public debt portfolio hovers around $2 trillion (or around €1,860 billion), representing about two-thirds of the continent’s combined GDP, with external debt alone accounting for over $650 billion.
Debt-to-GDP Ratio shows the average ratio climbing to 64-66% from 44.4% in under a decade. Debt servicing has consumed over $70 billion to $90 billion annually, leading multiple countries to spend more on interest payments than on critical sectors like healthcare and education, according to data.
Despite the indebtedness, Africa’s potential to overcome the overriding burdens was not insurmountable with appropriate reforms initiated.
Africa has capacity to unlock up to $1.43 trillion annually through improved revenue collection, more efficient public investment, staunching illicit financial flows and corruption, deeper capital markets, expanded public-private partnerships, diaspora financing, and better use of natural capital.
Among the key opportunities identified are an estimated $469 billion in additional annual revenues from stronger tax and non-tax mobilisation, alongside roughly $299 billion in potential savings from improved public investment efficiency.
Public-Private Partnerships are highlighted as a powerful lever, with each additional dollar of public investment associated with approximately $1.40 in private investment.
Institutional investors, including pension funds, insurers and sovereign wealth funds, manage around $4 trillion in assets; yet less than 2.7 percent is allocated to infrastructure and productive sectors in Africa, underscoring significant untapped potential.
There is need for accelerated efforts to strengthen Africa’s financial systems through pan-African banks, integrated capital markets, and innovative instruments such as climate and Islamic finance.
A central pillar to this is the New African Financial Architecture for Development (NAFAD), which aims to leverage over $4 trillion in assets within Africa’s financial ecosystem. NAFAD amplifies the role of the African Credit Rating Agency, launched in January 2026, as an important tool for addressing perceived biases in sovereign risk assessments.
While Africa’s stock market capitalisation reached $1.2 trillion in 2024 — nearly six fold growth over two decades — activity remains concentrated in South Africa, Egypt, Nigeria, and Morocco, pointing to the need for broader market integration.
There is unwavering need to advance continental initiatives, including the African Financing Stability Mechanism, to ease liquidity pressures, strengthen financial stability, and help African countries manage debt refinancing risks at lower cost.
The meeting further made projects for Africa’s growth and challenges anticipated ahead with some regions expected to showcase growth due to various factors. East Africa is expected to remain the continent’s fastest-growing region, though growth is projected to ease from 6.6 percent in 2025 to 5.9 percent in 2026.
This will be spurred by rising energy and import costs linked to Middle East disruptions take their toll. There is however a rebound envisaged to raise it to 6.4 percent next year. West Africa may remain relatively stable, with growth projected at 4.7 percent in 2026.
This is, broadly in line with the estimated 4.8 percent for 2025, supported by strong agricultural production and continued infrastructure investment. North Africa is expected to grow at 4.0 percent in 2026 compared to 4.4 percent in 2025, reflecting weaker tourism demand from Gulf states, and the broader effects of global supply chain disruptions.
Central Africa, one of the few regions projected to see an uptick, is forecast to see growth rising marginally to 3.8 percent in 2026 from 3.6 percent in 2025, buoyed by sustained high oil prices.
Southern Africa may remain subdued growth at 2.1 percent in 2026, from 2.3 percent in 2025, weighed down by weaker mining and agricultural output and higher energy costs.
Downside risks to the outlook remain significant. Inflation is projected to stay elevated at 10.4 percent in 2026, posing continued challenges to macroeconomic stability and growth prospects.
Persistent geopolitical tensions, alongside prolonged global supply chain and energy disruptions, could further strain fiscal and external balances through higher energy and fertilizer prices.
In addition, financial market volatility and exchange rate depreciations risk amplifying debt and fiscal vulnerabilities, while rising global fragmentation may intensify pressures on external financing flows, including official development assistance.
More than 4,000 delegates from over 81 countries, including African Heads of State, finance ministers, central bank governors, and development partners, gathered in Brazzaville.
Zambia was represented by a delegation led by the central bank’s deputy governor, Francis Chipimo and sought to Strengthen Investment Partnerships.