Carlos Lopes: why is money dearest where Africa needs it most?
Africa gets about 23% of the climate finance it needs and pays two to three times more to borrow for solar and wind. The economist says it is time to change the terms.
Johannesburg — Africa has about 20% of the world's population but attracts less than 3% of global energy spending. In a lecture at the University of the Witwatersrand, published in The Conversation, economist Carlos Lopes of the University of Cape Town, a former senior UN and African Union official, asked a sharp question: why is capital most expensive exactly where needs are greatest?
The gap
- Africa received an average of $43.7 billion a year in climate finance in 2021–22, about 23% of what it needs.
- The ten most vulnerable African countries get 11% of it; ten others attract 76% of private climate investment.
- The rich world's promise of $100 billion a year by 2020 was first met only in 2022.
The cost of money
- Large wind and solar projects cost at least two to three times more to finance in Africa than in advanced economies or China.
- Cutting financing costs by one percentage point would cut wind and solar power costs by at least 8%.
- Countries hit by climate disasters are judged riskier, so they pay more, and borrowing after a disaster can cost more again.
Africa's case
Africa holds about 30% of the world's critical mineral reserves. Lopes warns against exporting them raw while factories stay elsewhere. Instead, he argues, Africa should:
1. Negotiate affordable finance that builds industry, energy, transport, cities and skills, not just "climate" projects. 2. Treat climate finance as development finance. 3. Turn minerals and renewable energy into local jobs and manufacturing, including batteries. 4. Put interest rates, guarantees and currency risk on the table in climate talks. 5. Make sure promised money is actually paid out.
Source: The Conversation, 6 September 2026.
