Presentation by Ken Kasigila from CRDB at Britain Tanzania Society event Nov 2021

1. CLIMATE FINANCE
What does COP26 mean
for Tanzania?
Kenneth Davis Kasigila

2. Climate Finance & the PARIS AGREEMENT
The Paris Agreement provides a framework for financial, technical and
capacity building support to those countries who need it.
The Paris Agreement reaffirms
that developed countries should
take the lead in providing
financial assistance to countries
that are less endowed and more
vulnerable, while for the first
time also encouraging voluntary
contributions by other Parties.
Climate finance is needed for
mitigation, because large-scale
investments are required to
significantly reduce emissions. It is
equally important for adaptation, as
significant financial resources are
needed to reduce the impacts of a
changing climate.

3. What is CLIMATE FINANCE?
Climate finance refers to local, national or transnational financing - drawn from public, private and
alternative sources of financing - that seeks to support mitigation and adaptation actions that will
address climate change.
• The Convention, the Kyoto Protocol and the Paris Agreement call for
financial assistance from Parties with more financial resources to those that
are less endowed and more vulnerable.
• This recognizes that the contribution of countries to climate change and
their capacity to prevent it and cope with its consequences vary
enormously.
• Climate finance is needed for mitigation, because large-scale investments
are required to significantly reduce emissions. Climate finance is equally
important for adaptation, as significant financial resources are needed to
adapt to the adverse effects and reduce the impacts of a changing climate.

4. How does the PARIS AGREEMENT WORK?
Implementation of the Paris Agreement requires economic and social transformation, based on the best available
science
The annual $100 billion goal, born at the 2009 CopenhagenAccord, formalized in Cancun in 2010 and
affirmed as part of the Paris pact.
The $100 billion goal recognizes that developing countries contribute less to climate change than
industrialized nations and often lack the financial resources to make a climate transition on their own.
The Paris Agreement works on a 5- year cycle of increasingly ambitious climate action carried out by
countries.
At this COP26, was a critical one as it reaches the first 5 years cycle where countries submit their plans for
climate action known as nationally determined contributions (NDCs).
In their NDCs, countries communicate actions they will take to reduce their Greenhouse Gas emissions in
order to reach the goals of the ParisAgreement.They also communicate actions they will take to build
resilience to adapt to the impacts of rising temperatures.

5. The UN GREEN CLIMATE FUND (GCF)
BACKGROUND
• At the Conference of the Parties
(COP16) inCancun, by decision
1/CP.16, Parties established
the Green Climate Fund (GCF) as an
operating entity of the Financial
Mechanism of the Convention under
Article 11.
• The Fund is governed by the GCF
Board and it is accountable to and
functions under the guidance of the
COP to support projects,
programmes, policies and other
activities in developing country
Parties using thematic funding
windows.

6. What does GCF LOOK FOR?
8 Results Areas Compliance with GCF
Policies
 Fiduciary standards
 Risk Management
 ESS
 M&E Criteria
 Gender Policy
 Legal Standards
Additionality of GCF
Funding
 Why GCF?
 Projects must crowd-in
additional financing on
top of GCF
Six Investment
Criteria
1. Impact Potential
2. Paradigm Shift Potential
3. Sustainable dev’ potential
4. Recipient needs
5. Country ownership
6. Efficiency & effectiveness
Strong Climate
Rationale
 Climate Impact of
investment is key
 Scientific evidence to be
provided
Completeness of
documentation
 Feasibility study
 Financial Model
 ProjectTimetable
 GenderAnalysis
 Environmental studies
 No-objection letter
Country Driven
Approach
 Alignment with NDCs
 Early country (NDA)
engagement
 No-objection letter
Energy Transport
Buildings, Cities,
Industries
Ecosystems
Livelihoods of
people & comm.
Forests and
land use Infrastructure
Health, food and
water security

7. What does COP26 MEAN FOR TANZANIA?
• Tanzania Financial Sector Development Master Plan (FSDMP) 2020/21 – 2029/30 – Action Plan
• FSDMP is a strategic move by the Tanzania’s Government to chart the future direction of the financial sector
to cater for diverse financial needs towards attaining economic development.
• The Master Plan contains strategies which focus on enhancing existing financing resources and develop new
options of financing through banks, capital markets, social security and insurance
• Strengthen partnership with players in GREEN financing and Blue Economy.
Implementation Matrix; STRATEGY 4.2
• Encourage banks and financial institution to provide long term credit to productive sector.
• 10% of loan portfolio in banks and financial institutions allocated to long term projects by 2030.
• Number of agricultural marketing cooperatives and other agriculture community-based saving
organisations linked with banks
• Low capacity of the insurance industry to underwrite environment and climate change risks: There
is low technical and financial capacity of the local insurance industry to underwrite risks emanating
from environment and climate change;

8. Tanzania is LEADING THE WAY

9. COP26 CONSENSUS ON KEY ACTIONS
Adaptation, mitigation and finance are all
strengthened in a complex and delicate
balance supported by all Parties.
After six years of strenuous negotiations,
pending items that prevented the full
implementation of the Paris Agreement
on carbon markets and transparency have
finally been approved.
KEY WINS
Finance was extensively discussed
throughout the session and there was
consensus in the need to continue
increasing support to developing
countries.
The call to at least double finance for adaptation was welcomed by the Parties.The duty
to fulfil the pledge of providing 100 billion dollars annually from developed to
developing countries was also reaffirmed.
A process to define the new global goal on finance was launched.
On mitigation, the persistent gap in emissions has been clearly identified and Parties
collectively agreed to work to reduce that gap and to ensure that the world continues
to advance during the present decade, so that the rise in the average temperature is
limited to 1.5 degrees.
Parties were encouraged to strengthen their emissions reductions and to align their
national climate action pledges with the Paris Agreement.
A key outcome is the conclusion of the so-called Paris rulebook. An agreement was
reached on the fundamental norms related to Article 6 on carbon markets, which will
make the ParisAgreement fully operational. This will give certainty and predictability to
both market and non-market approaches in support of mitigation as well as adaptation.
And the negotiations on the Enhanced Transparency Framework were also concluded,
providing for agreed tables and formats to account and report for targets and emissions.
Commitment to phase out coal and fossil fuel subsidies, supporting forests conservations and
land use as well as more climate finance pledges (most not legally binding)."

10. Thank You!
Kenneth Davis Kasigila
Email: kenneth.kasigila@gmail.com
Mobile: +255754763558