Attracting finance and investment for the energy transition in Africa

International investment flows can support the energy transition, contribute to achieving the 2030 Sustainable Development Agenda and deliver the Paris Agreement objectives. In developing countries, energy investment is needed not only for the transition, but also to ensure access to sustainable and affordable energy for all. In 2023, UNCTAD projected that developing countries need renewable energy investments of $1.7 trillion each year but attracted only $544 billion in clean energy FDI in 2022.

Objective of the Project :

This project aims to assist 5 countries in Africa (Ethiopia, Malawi, Namibia, Seychelles, and Tanzania) to strengthen their capacity to promote and facilitate investments that contribute to the energy transition. It will build beneficiary government capacity, through the investment promotion agency, to design energy transition investment strategies, and support stakeholders to promote and facilitate sustainable energy and related investment opportunities.

Main Outputs:

1. Strategy for attracting investment and finance in the renewable energy sector

   The project will be developed in close cooperation with national investment promotion agencies (IPAs) strategies for attracting investment in the renewable energy sector, in line with national development objectives and national energy strategies and defined Nationally Determined Contributions (NDC) to the Paris Agreement. The strategies will include an overview of the renewable energy sector, investment opportunities in energy transition, and an action plan for the preparation/selection of projects, and targeting potential investors, including institutional investors. (Year 1 and 2)

2. Capacity-building in the design, identification, and promotion of bankable renewable energy projects

   The project will also include a series of training sessions for staff of the national IPA and related entities in government such as subnational IPAs, special economic zones (SEZs), and public- private partnership (PPP) Units in the design, promotion and facilitation of bankable projects that contribute to the energy transition. (Year 1 and 2)

3. Marketing e-platforms for renewable energy investment projects

   Digital marketing dynamic, interactive online platforms and investment guides (UNCTAD’s e- Opportunities and i-Guide respectively) for the promotion of bankable projects in the renewable energy sector will be developed for each project country. The platforms will be managed by the national IPAs. (Year 2 and 3)

4. Partnerships in attracting investment in renewable energy projects

   It will forge partnerships with institutions within and between countries. Within countries, it will contribute to strengthen the relationships between IPAs, SEZs, SMEs, development institutions, ministries, as well as non-governmental organizations and private sector associations that encourage renewable energy investment. Between countries, it will forge partnerships between outward investment promotion agencies (OIPAs) that support renewable energy investment, IPAs and SEZs, and domestic green enterprises. (Years 2 and 3)

Intended Outcomes :

• Outcome 1: Strengthened capacity of national governments, including investment promotion agencies (IPAs) and related entities, to design strategies to attract investment in the renewable energy sector, including from institutional investors
• Outcome 2: Enhanced capacity of investment promotion agencies and related entities to design and promote bankable renewable energy projects.
• Outcome 3: Strengthened partnerships between investment promotion agencies and related entities in host countries and outward investment promotion agencies (OIPAs) in home countries on investment in the renewable energy sector.

Link to the SDGs:

• Eradicate extreme poverty (people living on less than $1.25 a day). (SDG 1)
• Access to affordable, reliable and modern energy services. (SDG 7)
• Expand infrastructure and upgrade technology for supplying modern and sustainable energy services for all in developing countries, in particular least developed countries, small island developing States, and land-locked developing countries. (SDG 9)
• Encourage official development assistance and financial flows, including foreign direct investment. (SDG 8)

• Documents