Financing the Green Dream: Africa’s Climate Projects Wait in Limbo

 

As Africa’s climate ambitions collide with tightening fiscal space and intensifying climate shocks, the focus is shifting from policy promises to execution, with the widening gap between plans and bankable projects emerging as a major constraint on the continent’s green transition.

Although governments across Africa have adopted climate and development strategies, funding remains far below what is needed. The Africa Climate Finance Tracking Report 2025 estimates that current flows meet only about 25% of Sub-Saharan Africa’s annual climate financing requirements, highlighting the scale of the challenge as countries contend with rising debt burdens, energy shortfalls and growing water stress.

It is within this context that Africa’s Green Economy Summit (AGES) 2026 will be held in Cape Town from February 24 to 27. Under the theme “From Ambition to Action: Scaling Investment in Africa’s Green and Blue Solutions,” the summit will bring together policymakers, investors, project developers and development partners to address a central question: how to move climate projects from concept to implementation.

Africa continues to receive a disproportionately small share of global climate finance, even as climate-related risks mount. At the same time, declining concessional funding and increased competition for private capital are accelerating a shift toward investment-led approaches, sharpening the focus on project quality, bankability and effective risk allocation.

“Global climate discussions often focus on commitments and coordination, but delivery ultimately depends on where capital decisions are made,” said Emmanuelle Nicholls, Group Director for Green Economy at VUKA Group. She said AGES 2026 is designed to examine which projects, in which markets, are realistically positioned to meet current financial conditions and progress toward implementation.

Unlike global climate forums built around pledges and declarations, AGES 2026 will centre on capital flows—where investment is moving, where it is stalling and what is required to reach financial close. The programme will explore regulatory certainty, investment readiness and financing structures across key green and blue economy sectors, including energy, water, transport, manufacturing and agriculture.

“The real constraint is not a shortage of projects, but a lack of financing structures that can meet projects where they are,” said Teboho Makhabane, Head of ESG and Impact at Sanlam Investments. He said platforms that connect investors, developers and policymakers are critical to unlocking viable projects that deliver both economic impact and sustainable returns.

Reinforcing its continental mandate, the African Union will again serve as host of AGES 2026. The summit will also convene the AU–Green Recovery Action Plan (AU-GRAP) Grand Finale Roundtable, marking the close of Phase I of the programme. The session will review outcomes from five Green Investment Roundtables and help shape Phase II, positioning AU-GRAP as a key mechanism for mobilising climate and nature finance across the continent.

“We can only close the climate and nature finance gap if we understand the real movements of capital both the momentum and the constraints,” said Barbara Buchner, Global Managing Director at the Climate Policy Initiative. While progress is being made, she noted, finance remains uneven and is still not reaching many of the regions and sectors most in need.

A central feature of AGES 2026 will be its Investment Pitch and Showcase, presenting a curated pipeline of more than 50 vetted African projects spanning renewable energy, battery storage, climate-resilient water systems, electric mobility, waste-to-value solutions, circular manufacturing, climate-smart agriculture and resilience technologies.

Backed by partners including Sanlam Investments, Standard Bank, UNOPS, UNEP, FSD Africa and the City of Cape Town, AGES 2026 aims to push Africa’s climate agenda into a more grounded, investment-ready phase—focused less on ambition and more on execution as the continent seeks to close its climate finance gap.