IMANI Africa’s key recommendations to Gov’t in unlocking private sector investment in Ghana’s climate action goals
In a groundbreaking report, IMANI Africa has outlined a series of pivotal recommendations aimed at surmounting barriers to private sector investment in Ghana’s climate change initiatives. The Think Tank’s comprehensive proposals target the enhancement of domestic climate governance, establishment of a clear financing plan, and fostering a sector-wide policy framework to attract vital private capital.
IMANI Africa underscores the need for improved transparency in climate risk data at the project level, essential to engender confidence in the private sector’s commitment to financing the Nationally Determined Contributions (NDCs). The government, particularly the Ministry of Finance, MESTI, and Cabinet, must develop a definitive financing plan that meticulously links programmes of action to specific funding sources. This targeted approach promises to streamline financing allocation and ensure robust tracking mechanisms throughout the budget cycle.
With an eye on fostering investment attraction, the Think Tank emphasizes the importance of creating a comprehensive sector-wide policy framework. IMANI Africa contends that linking incentives established under these policies to climate action goals will play a decisive role in incentivizing private sector involvement.
Additionally, IMANI Africa underscores the imperative of addressing capacity gaps in preparing bankable or commercially viable projects by government agencies. Active technical assistance from donor partners and private sector entities can provide the necessary support to bolster the credibility of project proposals, demonstrating scalability and sustainability.
To fortify inter-agency collaboration and facilitate timely information flow, the report advocates for a composite national climate legislation. This legal framework would bind institutions to incorporate climate reporting into developmental and annual reports, ensuring a coordinated approach to climate financing.
In a bid to accelerate private finance, the Think Tank proposes leveraging public sector financing by employing grants to provide initial capital for high-potential private sector investments. Underwriting specific risks that impede private sector involvement, such as currency and political risks, could stimulate private capital participation and foster a conducive investment environment.
Furthermore, IMANI Africa highlights the importance of bolstering Development Bank Ghana’s capacity to build green portfolios and invest in climate-smart projects. This strategy positions the nation to harness innovative financial instruments and attract domestic or international climate finance.
Lastly, the report encourages the exploration of green bonds and sustainable development debt instruments, despite the country’s current unsustainable debt levels. These financial instruments, directly invested in climate mitigation and adaptation projects, could chart a path toward sustainable growth without adversely affecting the macro-fiscal conditions.
IMANI Africa’s forward-thinking recommendations hold the promise of transforming Ghana’s climate finance landscape, unlocking private sector investment, and propelling the nation towards a more resilient and sustainable future.
