Economic challenges: risks and opportunities?
The African continent must deal with various economic challenges. According to the FAO, the agricultural sector is critical to Africa’s economy, as it accounts for 65% of direct jobs and contributes 15% to Africa’s total GDP. However, as Africa’s agriculture (farming, animal husbandry) is still very dependent on rain waters, any change in the water cycle also affects agricultural yields, putting food safety at risk. Moreover, some agricultural regions are now affected by the degradation of their natural resources (soil/water), primarily due to mismanagement.
Climate change could thus exacerbate already weakened ecosystems. Studies show that a global temperature increase of 2°C by 2050 could reduce Africa’s GDP by 4.7%, making it urgent for African countries to adapt to climate change.
Another economic challenge for Africa is universal access to energy. Without energy, there can be no development. Africa has abundant energy reserves but only a tiny portion is used. By investing in renewable energy, Africa could improve its economic and environmental development, sustainably meet its energy needs, and develop activities that generate local income and jobs. This strategy could produce considerable economic and social returns, as moving towards an energy transition scenario would create many jobs.
Economic development also influences the adaptive capacities of countries and communities. The local economy is an interesting vector of both development and climate change adaptation in this regard. It could be developed by using the specificity and richness of each region to create jobs, generate income and foster innovation. These factors would help diversify local economies and, thus, household revenues, making them less dependent on activities vulnerable to climate change on the one hand, while giving them the means to develop assurance systems and financial safety nets to mitigate the impacts of climate change on the other.