African Development Bank : Enabling direct access to climate finance in Africa

Direct access by national institutions to climate finance has been a revolution for African countries. What was regarded as a risky and pioneering approach to channelling funding to climate projects when the Adaptation Fund (AF) first piloted it in 2010 is now widely recognised as a good practice in climate finance.

This according to Dethie Soumare Ndiaye of the Centre de Suivi Ecologique (CSE), a national institution in Senegal which was the first to pilot direct access when it went through the rigorous process to become accredited to access funding from the AF, and more recently from the GCF.

However, the journey to accessing climate finance is lengthy and tough. In order to be accredited to access funding, an institution has to demonstrate that it has sound financial management capacities as well as safeguards to protect against environmental and social harm.

Out of 48 (according to the GCF's last Board meeting) accredited entities to the GCF around the world, nine are national or regional entities in Africa. 'African entities are competing with the gold standard,' said Zaheer Fakir, Co-Chair of the Green Climate Fund Board. 'They are demonstrating that they have the same standards (as the international entities), with less people and fewer resources'.

Still, many African countries have not yet succeeded in getting a national institution accredited, or in accessing finance at the scale they aspire to. Many national institutions can only take on small (US $50 million or less) and low-risk projects. As a result, less than 10% of the funding approved by the GCF to date is being channelled through direct access entities. 'I can understand why the proportion of GCF funding through direct access is low,' said Wangare Kirumba of the Kenyan National Environment Management Authority (NEMA), accredited to the AF and the GCF. 'But what are the interventions that can ensure that this proportion grows to 70 or 80% in the next 15 years?'

We need to empower African institutions and build African capacity

African institutions need support in order to build their capacities to access climate finance, according to Ndiaye Cheick Sylla, alternate Board member of the GCF and Advisor to the Senegalese Government on climate change. 'The GCF is providing this support through its readiness programme '. Several other institutions including WRI, the AfDB, the German development agency, GIZ, and others are also supporting such initiatives.

At the same time, national institutions are learning from each other's experiences. 'We learned from CSE's innovations in managing executing entities, and of the importance of learning by doing,' said Kirumba about a recent study visit by NEMA officials to learn from CSE's experience as an accredited entity to the AF and GCF. 'There is a need to formalise this South-South cooperation and develop a platform for exchange so that many national institutions can learn from the experience of their peers. We are trying to mobilise support for such a platform,' said Dethie Ndiaye.

'The accreditation process was lengthy and complicated, but it was worth the effort,' claimed Kirumba. 'Every African country can have a national accredited entity,' insisted Fakir. 'We need to empower African institutions and build African capacity'. The AfDB, accredited national entities, and other partners have an important role to play in achieving this ambitious goal.