19 August 2017

Ethiopia: Norway Pledges Fresh Finance for Climate Resilience

The government of Norway has granted 1.74 billion Br for the implementation of Climate Resilience & Green Economy (CRGE) strategy, aiming at addressing and reducing the effects of climate change in the country. The grant comes at a time when the country faces a shortage of climate finance.

The agreement was signed between Admasu Nebebe, state minister at the Ministry of Finance & Economic Cooperation (MoFEC), and Andreas Gaarder, Ambassador of the Royal Norwegian Government in Ethiopia on August 16, 2017.

The partnership agreement was made to implement the second phase of the Ethiopia-Norway climate partnership agreement between 2017 and 2020.

It is the second contribution by Norway for the same purpose since the launch of the strategy in 2011 during the administration of the late Prime Minister Meles Zenawi, who had a leading role in international climate negotiations on behalf of African nations. By that time Norway had pledged 50 million Br donations to Ethiopia.

The strategy aims at developing a carbon neutral and climate resilient middle-income country by 2025. It targets to reduce emissions and increase climate resilience in eight key sub-sectors including energy, buildings and cities, soil based emissions, livestock, transport, industry and health.

CRGE is expected to serve a supportive document for the implementation of the project of Reducing Emission from Deforestation and Degradation, a.k.a REDD+ investment program, a framework that extends financial rewards towards developing countries which manage to reduce emissions by maximising the conservation of forests.

It was first launched 10 years ago during the conference of the United Nations Framework Convention on Climate Change (UNFCCC).

The newly signed agreement will be implemented in line with the Ethiopian REDD+ Investment program, whose primary target is to reduce carbon emissions through reforestation of plants, according to Admasu.

"We will ensure the fund will be used for the mutually agreed purposes as defined in the program document," said Admasu.

The fund will be used to foster prevention of deforestation and degradation across 660,000ha of natural forest in the South-West Forest blocks in the Southern Nations, Nationalities & Peoples' Regional State (SNNPR), Gambella, and parts of Oromia Regional State.

The fund is expected to reduce poverty, improve the livelihood of people as well as play a major role in conserving biodiversity and providing clean water, according to Admasu.

As a part of the strategy, the fund will also be allocated for community-based afforestation and reforestation on 80,000ha of land in Amhara and the Tigray regional states as well as improving the livelihood of over 75,000 households.

"To implement the strategy successfully, a strengthened focus on innovation and new partnerships is essential," he stated.

However, despite being ambitious, implementing the strategy seems feasible for some experts.

"It is very ambitious and envisions achieving middle-income status in a green and climate resilient way when no country has ever developed in such a manner," said Haileselassie Medhin (PhD), director of Environment & Climate Research Centre at the Ethiopian Development Research Institute (EDRI).

"The fundamental question is therefore not whether this can be achieved by 2025 but rather if it can ever be accomplished," he said. "And I think the answer is yes."

Haileselassie believes that attempting what has never been done before will be challenging for the government.

"There are also challenges of institutional coordination," he said. "More work needs to be done in rolling out effective policy instruments that channel consumption and investment decisions."

Two years ago, Ethiopia aimed to limit national carbon emissions by 64pc in 2030. Last year, Ethiopia's national climate budget was estimated at roughly 440 million dollars, with investments worth tens of millions of Br acquired from international partners.

The new grant by Norway was approved five months after four countries – United States, Canada, Sweden and Germany – objected to funding a proposal to build a climate resilience economy.

This content is edited after the original content mistakenly misquoted Haileselassie Medhin (PhD), director of Environment & Climate Research Centre at the Ethiopian Development Research Institute (EDRI) as if he said that the strategy is unfeasible. We sincerely apologise for any inconvenience this mistake may have caused.


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