Vice President Yemi Osinbajo has declared that participating in the carbon market would not only offer Nigeria and Africa the opportunity for growth, industrialisation and job creation for its teeming population, but also provide the right incentives for clean energy and climate action.
According to him, the Carbon Market pipeline could create 30 million jobs in the next decade, with the potential to create more than 100 million jobs through climate aligned projects by 2050.
Osinbajo made this disclosure in a keynote address at a high-level international meeting on Africa Carbon Market Initiative (ACMI) hosted by the Rockefeller Foundation in New York City, USA, where he stressed the importance of building the carbon markets architecture in Africa.
He stressed that participating in the carbon market offers Africa the opportunity to pursue growth, industrialisation, economic value creation, with the right incentives for clean energy and climate action.
The meeting explored potential opportunities which carbon markets offer to generate resources for clean energy transitions while accelerating economic growth in Nigeria and other African countries.
Speaking against the backdrop of global rapid expansion of the carbon markets, the vice president noted that Africa currently only has a small share of this carbon market, but the current market can be scaled in a massive way - to reach FDI of $120 billion to $200 billion annually.
For a continent that needs $240 billion annually in mitigation investment alone, this carbon finance stream could be the difference between transitioning and not (transitioning).
Emphasising the market's benefits for the African continent at the Rockefeller Foundation meeting, Osinbajo said the combination of capital flows, job creation, and avoidance of long-term climate destruction are critical drivers of the interest of African leaders in supporting this effort.
"As all of us in this room understand well, the priorities of the African continent are not just to act decisively on the climate crisis, but to also create significant growth opportunities for our young and growing population."
Commenting on the challenge of funding, Osinbajo noted that the investment required to advance the energy transition in Africa is huge as World Bank estimates suggest that Africa needs $6.5 trillion US dollars between now and 2050 for mitigation action alone to keep temperatures below 2 degrees of warming.
Lauding the positive Pan-African efforts at developing carbon markets on the continent, he noted that the rapid progress recorded in Africa benefitted from the support of a very engaged Steering Committee with President Duque, the UN, Global Energy Alliance for People and Planet (GEAPP), USAID, and a range of other public and private actors, which resulted in the successful launch in Sharm-el-Sheikh COP-27.
"The strong commitment and presence from fellow African leaders demonstrate the willingness and leadership of Africa. We already have seven African countries (Burundi, Gabon, Kenya, Malawi, Mozambique, Nigeria and Togo) signed up to develop country carbon activation plans and over $200 million in Advanced Market Commitments - which we must continue to further advance as this is going to be the critical driver of action on the Continent."
Osinbajo then commended the support and assistance on the progress recorded so far on the African Carbon Market Initiative, including from the US government, relevant UN bodies and other international organisations like the Rockefeller Foundation, and GEAPP.
According to him: "I think it's an auspicious moment for Africa to be participating more fully in the global carbon market conversation, especially in the light of the slowing pace of green investment flows into the continent.
"The work several of us have done together in the past few months, makes it clear that while other sources of flows are slowing down globally Carbon Markets are growing rapidly."
The Vice President further observed that other initiatives demonstrate that there is growing acknowledgement of the role of carbon finance.
"One of the strong points of ACMI and the way we must structure it going forward, in terms of governance, is the flexibility to smoothly work with other initiatives, and there will be many others".
Referencing the Energy Transition Accelerator announced at COP27 by the US Special Presidential Envoy for Climate, the Vice President said, "two days to the opening of Cop 27, Sen. John Kerry and I had a conversation about the proposed Energy Transition Accelerator and we both agreed that once the details were worked out, we would work out a collaborative framework with ACMI."
He further said: "The key really in the brave new world of energy transition initiatives is collaboration, and synergies. I look forward to speaking to Senator Kerry and aligning our efforts - especially on power sector credits, which will be central to keeping up and delivering on the momentum we've worked so hard on."
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
Osinbajo noted that the single biggest thing standing in the way of making rapid progress on emission reductions is the absence of money dedicated to the cause.
"And we surely can find that money - which is why today's meeting is both extremely valuable and timely. We all know that the hard part comes next. We have created energy and excitement, and our collective reputations are on the line," Osinbajo stated, while calling on African leaders to "take responsibility to ensure this exciting momentum is maintained, and scaled up.
"Carbon markets will play a critical role in the implementation of this (Energy Transition) Plan - in mobilising the capital required to move to our net-zero economy-wide trajectory. I want Nigeria to have the first Carbon Markets Activation Plan," he noted.
The vice president reiterated the federal government's continuing efforts on the climate change issue.
