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Speaking during a two-day Regional Roundtable discussion for Africa and the Middle East on sustainable environment funding, experts said it was vital to acknowledge the importance of financial incentives.
The speakers – at the United Nations Environmental Programme and Financial Initiative (UNEPFI) Regional Roundtable for Africa and the Middle East– added that encouraging and rewarding sustainable investments will attract capital flows into projects that align with sustainability goals.
“By creating favourable conditions for investors, we stimulate economic growth, generate employment opportunities, and ensure the long-term well-being of our people. Namibia, a land of breathtaking beauty and rich biodiversity, is not immune to the global challenges we face. Climate change looms large, with high temperatures, erratic weather patterns, and increasing natural disasters," said Prime Minister Saara Kuugongwelwa-Amadhila in a speech read on her behalf by her special advisor Nangula Mbako.
Kuugongelwa-Amadhila said climate change puts natural resources under pressure and disrupts the balance of the ecosystems through unsustainable practices that result in far-reaching social and economic implications, threatening the well-being and livelihood of people.
"It is therefore within this context that we must turn our attention to the concept of sustainable finance. Sustainable finance involves integrating environmental, social, and governance considerations into financial decision-making, ensuring that economic growth is pursued in harmony with environmental preservation and social well-being," the Prime Minister said.
"It is important to not treat sustainability as an afterthought, it must be a guiding principle in our decision-making processes. Our policies should promote green and sustainable practices, such as renewable energy, efficient resource management, and sustainable agriculture," she added.
To achieve such targets, Kuugongelwa-Amadhila said a robust regulatory framework for sustainable finance, laws and regulations should be able to encourage responsible investment practices, incentivise environmentally friendly projects, and ensure transparency and accountability in financial transactions.
"By doing so, we create an environment where sustainable investments thrive, supporting our economic development while safeguarding our natural heritage," she said.
She, however, noted that the responsibility of transformation does not lie solely with the government, but a collective action involving the private sector and civil society.
Meanwhile, Finance and Public Enterprises Deputy Minister Maureen Hinda-Mbuende said despite the huge demand for finances especially for public investments, there seems to be a robust supply of development finance that is not being tapped into, especially with private investors.
"In 2020 alone, global financial assets grew to U$469 trillion at the same time when the SDG financing gap in developing countries was U$3.9 trillion of which is partly toward Environment, Social and Governance (ESG). This shows that there is adequate global finance for the ESGs, but what is missing is a synchronized effort to align available capital with ESG-aligned national priorities," Hinda-Mbuende said.
She made reference to the southern part of Namibia where desertification is fast approaching, calling for the intervention of investing in tree planting and renewable energy such as the envisaged Green Hydrogen Project, sustainable agriculture, and conservation measures which can drive towards a low-carbon economy.
"This will reduce our carbon footprint and promote climate resilience. As we work to develop and improve the region’s economic stability, we must also find ways to protect the environment so that future generations can continue to benefit from our progress, hence the need for sustainable financing. It offers an opportunity to invest in initiatives that both optimise financial returns and promote long-term environmental, social, and economic sustainability," Hinda-Mbuende stressed.
"We can mitigate the impact of climate change and protect our invaluable ecosystems which I wish we could find ways to rebuild, as protection alone is not sufficient in our contexts of being sandwiched by two aggressive deserts namely the Namib and the Kalahari. I call it aggressive due to the rate it continues to encroach," she stated.
Namibia National Reinsurance (NamibRe) Managing Director Patty Karuaihe-Martin whose company is a co-organiser, said she is very confident the UNEPFI discussion will be remembered as a starting point of many such African collaboration and future development of sustainable finance in Africa.
"I have observed various solutions being shared varying from our banking sector. We had discussions ranging from policy makers to the government and how our regulators can play an instrumental role in making the future of sustainable finance a priority and ensuring that it becomes a reality and implementable," she said.
Adding that "these were indeed African voices and we can be sure that there will be significant developments in the sustainability space from an Africa perspective".