LONDON, Sept 15 (Reuters) – Using Africa’s vast agricultural resources to help tackle climate change could earn the continent $1.5 billion a year, a World Bank head said on Tuesday.
The region should also tap its underexploited renewable resources, particularly hydropower, to meet increasing energy demand and boost both growth and development.
“It is essential that climate change be viewed as a major development opportunity for Africa given the anticipated increase in the energy requirements as growth accelerates,” the Bank’s managing director Ngozi Okonjo-Iweala told a public lecture at the London School of Economics.
“Agricultural carbon sequestration could generate annual revenues of close to $1.5 billion,” she said, adding that agricultural land management would need to be included in future climate pacts so Africa could benefit from the carbon market.
Carbon sequestration is the uptake and storage of carbon, for example by trees and plants which absorb carbon dioxide.
By 2030 an estimated 5.5-6 gigatonnes of CO2 equivalent a year could be mitigated by agriculture with about 89 percent achieved by soil carbon sequestration, according to a U.N. climate change paper on agriculture last year.
Okonjo-Iweala added that only 8 percent of the continent’s hydropower was currently being exploited, and that increasing the used of its renewable resources would help Africa meet growing demand for energy as growth picks up.
But she acknowledged climate change was also a big challenge for the continent, as rising temperatures mean the agricultural sector — which employs around 70 percent of Africa’s population — is hit by more frequent droughts and flooding.
Although economic growth across Africa averaged over 5 percent a year between 2001 and 2008, it is expected to be below 3 percent this year as the global economic turmoil has hit trade and foreign direct investment.
Speaking about the challenges facing Africa as it at aims to get back on its pre-crisis growth trajectory, Okonjo-Iweala, a former Nigerian foreign minister and minister of finance, said the continent needed to focus on labour intensive sectors, such as manufacturing, in order to accelerate growth.
“In many cases (the previous growth) didn’t create jobs at a rate fast enough to absorb the large numbers of youths coming onto the job markets,” she said, adding that attracting Chinese manufacturers could help tackle this problem.
“China is moving up the value chain in terms of its production and manufacturing, costs are increasing … companies that are experiencing higher costs will find it profitable to relocate their plant and equipment to the (African) continent.”