Namibia-EU sign raw materials value chain partnership
• By Uaueza Kanguatjivi
PRESIDENT Hage Geingob signed a Memorandum of Understanding (MoU) with the European Commission (EU) on Tuesday at COP27, in Egypt, for the funding of Namibia’s green transition and the exploration of rare earth elements.
Delivering his keynote address in Egypt, Geingob said climate emergency remained one of the key challenges facing humanity.
“It is a test of the multilateral system and this offers an opportunity to justify the unique purpose of the multilateral system. Cop27 offers another opportunity for the International community to bring its full weight behind efforts ensuring that we meet our global climate mitigation targets.”
Geingob encouraged developed countries to support developing nations by capitalising on the Green Climate Fund.
“Thus far, only US$23 billion has been committed. We are confident, that the African COP will serve as a potential tipping point for creating a greater consensus that results in the mobilisation of support in practice. Namibia will continue to strengthen its efforts towards greening the Namibian energy economy, through ongoing efforts to support a nascent hydrogen industry,” said Geingob.
He said through National Green Hydrogen efforts, Namibia remains well-positioned to become a major supplier of clean and green energy to the world.
“Our Green hydrogen agenda which is premised on harnessing cleaner sources of energy has now set sail with an Inter-Ministerial Green Hydrogen Council (GHC), launched on the May 23 last year, as outlined in the second Harambee Prosperity plan,” he said.
In building Namibia’s commitments under COP26 for COP27, the country has unlimited priorities which include amongst others splitting climate finance evenly between adaptation and mitigation, the President said.
“Proceeds from the global carbon market system set up under the Paris Agreement should towards the Adaptation Fund to finance projects and programs in developing countries. Other priorities include, urging the scaling up for the levels of climate finance, this would be done by providing concrete long-term targets for climate finance pathways and accounting methodologies for the collective foal of developed countries to reach US$100 billion a year from 2025 and beyond,” he said.
Geingob called on developed countries to provide the means of implementation and support the effective implementation and enhancement of nationally determined contributions by developing countries.
Among other priorities, Namibia aims to enhance the full operationalisation of the Santiago Network on Loss and Damage, in order to achieve the mandate of providing actions and support for vulnerable developing countries.
Meanwhile, Namibia launched the SDG Namibia One program, at the United Nations Climate Change Conference, COP27, a new investment platform that will convene and coordinate activities related to the transition and exploration of the green hydrogen industry in Namibia and aims to mobilise up to N$17.8 billion of investment capacity over the next 10 months.
“SDG Namibia One is a blended financing platform managed in partnership between Invest International, Climate Fund Managers, and the Environmental Investment Fund of Namibia (EIF).
Despite this great opportunity for Namibia, we recognize that the green hydrogen industry is in its infancy and it is difficult to predict how the market will develop in the long term and that we will face challenges relating to finance technical capacity and many others still to be unforeseen.
However, we will work closely with our international partners to mitigate such risks, hence blended finance in the form of SDG Namibia One was launched today with the premise to attract a diverse group of players in our development journey,” reads a statement released by the government.
Meanwhile, Dutch Prime Minister, Mark Rutte announced a Grant Facility of 40 million euros as a seed capital to establish the SDG Namibia One during its launch this week.
“A funding agreement for an initial development capital of 40 million euros was signed between the Namibian Government and the Dutch Government during the launch. The strategy is to use the grant as a catalyst for additional development capital to the SDG Namibia One.
This will subsequently de-risk private capital and facilitate further investments at scale to support the development of high-quality green hydrogen assets and associated value chains.
Infrastructure development is faced with challenges such as scale, risk sharing, speed, and competition.”
The platform is therefore designed as a program, with a multiphase approach that includes a development fund, construction fund, and operational fund.
“Such design facilitates successful fundraising and investments in untested markets and projects, as well as to attract sponsors with limited proofs of concept,” the statement reads.
The SDG Namibia One, according to the Namibian government, is premised on a partnership that relates to capacity building as the joint venture allows the unique international expertise and investors’ relationship of the Climate Fund Managers to be harnessed while connecting the domestic expertise of the Environmental Investment Fund of Namibia and giving them exposure to sophisticated capital raising and deal structuring elements.
“The Environmental Investment Fund of Namibia will therefore benefit from the capacity building by being directly involved at the fund manager level from the outset, including development of the fund management, investment, fund raising, and capital mobilisation abilities. Moreover, additional skilled bandwidth and bench strength will thereby be created at the Environmental Investment Fund of Namibia and ultimately within the government of Namibia,” the release read.
The Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCCCOP27) got underway in Sharm El Sheikh, Egypt.
The climate implementation summit, attended by world leaders kicked off the 27th United Nations Climate Change (COP27), hosted by Egypt which holds the COP27 presidency.