Thinking about Africa in the context of the climate crisis makes for some cognitive dissonance. On the one hand, the continent’s massive potential for renewable energy, its stocks of critical minerals, and its storehouses of oil, gas, and coal make it a huge “ka-ching” in continental form.
On the other hand, Africa’s large youth population, its weak economies and its outsized exposure to climate stress means that many European policymakers see it as a time-bomb threatening wave after wave of instability and migration.
These contradictions are increasingly driving a series of deals between Europe (in collaboration with the G7, collectively as an EU bloc, and as individual countries) and African states centering on the unstable overlap between energy and climate.
The complication for Europe is that they face a changed African landscape, where China offers a wide range of technology and financing options for both dirty and clean energy, and where Chinese actors are already deeply embedded in the critical minerals sector the G7 is circling so intently.
Last year I got the opportunity to explore these complexities during a stint at SWP, a research institution in Berlin. A paper based on that research has now been published.
Here are a few takeaways:
Norm-setting: This project concentrated on Europe-led Just Energy Transition Partnerships (JETPs) between the G7 and key African countries. The JETPs are cross-cutting initiatives aimed at making entire economies less carbon-intensive. They entail broad measures, including capacity-building and policy reforms to make these projects more attractive to European companies.
This, in turn, dovetails with European attempts to use the economic clout of the EU to drive global standard-setting via mechanisms like the Carbon Border Adjustment Mechanism (CBAM) that charges carbon tariffs on imports.
This attempt to put European norm-setting at the heart of its climate interaction stands in contrast to a different kind of norm-setting from China: the fact that China overtook Germany as the prime manufacturer of solar components in the mid-2010s and now produces about 80% of the world’s supply. This means that whatever the arrangement with the G7, it will be mostly impossible to remove China from the continent’s energy mix.
Energy Demand: There is an interesting tension between the European/G7 drive to decarbonize the economies of South Africa and Senegal, and the fact that these countries are domestically less worried about emissions than they are about yawning energy demand. The EU’s drive to take (for example) South Africa’s coal-fired power stations offline by replacing them with renewables stands in tension with a domestic drive to add more generation.
China is an interesting mix of partner and spoiler here. While its massive renewable capacity will help the decarbonization goal, China’s demand-driven approach means it’s less likely to go head-to-head with hydrocarbon lobbies in these governments.
Debt: One of the big questions hanging over the JETP process is how to pay for it. Only about 4% of the $8.5 billion JETP package offered to South Africa will be in the form of grants. The remaining 96% will be via different kinds of loans.
China’s engagement is also debt-dependent, but the combination of China’s demand-responsive approach, its “small is beautiful” project sizing, and the rhetoric of South-South cooperation subtly separates these optics from the view that the JETP represents a massive wealth transfer from the South to the North to pay for a problem the North caused.
EU stakeholders complain that much of this distinction is political. But at this moment of heightened tensions between the Global South and the Global North reflected by a wave of multipolarity, politics count.
Read the full working paper on the MegaTrends Afrika website.
