The African Development Bank (AfDB) last week proposed a new funding mechanism called the African Green Fund (AGF) to adapt to the impact of climate change.

The proposal was made at a parallel meeting of the ADF VII organised by African Development Forum under the auspices of the UN Economic Commission for Africa, the AU Commission and other stakeholders.

It could be recalled that the UN Framework Convention on Climate Change (UNFCCC) took place in Copenhagen Denmark in December 2009.

It was expected that at the end of the meeting, a post 2012 legally binding Climate Change treaty would be agreed upon by all parties to the convention.

However this was not achieved and a political non-legally binding accord, known as the Copenhagen Accord was agreed upon.

The Copenhagen Accord, among other things agreed to a collective commitment by developed countries to provide new resources.

They include investments through international institutions, approaching 30 billion dollars from 2010 to 2012.

This accord further commits developed countries to a goal of mobilising jointly 100 billion dollars a year by 2020 to address the needs of developing countries.

While the accord does not represent the comprehensive and decisive global agreement that was anticipated to keep global temperatures below 20C by 2050, it serves as a stepping stone towards a fair, ambitious and binding Climate Change treaty.

Based on Africa’s low access to existing global funds, the Africa Group at COP 15 led by Prime Minister, Meles Zenawi of Ethiopia requested that 40 per cent of the pledges under the Copenhagen Accord should be allocated to Africa.

The group further requested that the AfDB hosts and implements Africa’s share of this money.

In addition, several donors have expressed interest to allocate part of their commitments under the Copenhagen Accord to address Climate Change concerns in Africa through an instrument hosted and managed by the AfDB.

It is on this background that the Bank is proposing the creation of the Africa Green Fund (AGF).

According to Mr Anthony Nyong, staff of AfDB, the purpose of the AGF is to receive and manage resources allocated to Africa from all sources.

Nyong said that this would include financing and fast tracking long term pledges made under the Copenhagen Accord.

He said that regional member countries and other approved entities would have direct access to flexible instruments.

These, he said, would include grants, concessionary loans and risk mitigation instruments to support public and private sector investments in Africa.

“The AGF will provide a balanced allocation to both mitigation and adaptation and respond directly to national concerns through nationally defined objectives.

“The hosting and management of the AGF in Africa by the Bank will increase Africa’s access to the commitments under the Copenhagen Accord,’’ he said.