Africa faces a significant gap in financing for climate adaptation and resilience, with an estimated need of $70 billion annually by 2030, while Sub-Saharan Africa received only $12.96 billion in adaptation finance in 2023. Despite adaptation investments offering returns of two to fifteen times the initial investment, private debt remains underutilized for this purpose, with private sources contributing a minimal share of adaptation-specific financing. In Tanzania, for example, private climate finance accounts for only about 5% of total flows.
Adaptation finance represents both a risk mitigation and business opportunity for commercial banks and inclusive financial service providers. Climate shocks affecting agri-food systems, housing, and manufacturing increase the risk of loan defaults and financial exclusion, but proactive investment in adaptation can reduce physical climate risks, open new markets, and strengthen long-term profitability.
Under the Africa Adaptation Acceleration Program (AAAP), the Global Center on Adaptation (GCA) is scaling support to African financial systems by providing market opportunity analyses, technical assistance to domestic banks, capacity building, and guidance for national policy reforms. In collaboration with CGAP and CGIAR, GCA conducted market analyses in Tanzania, Kenya, and Zambia to demonstrate that climate adaptation technologies and services are bankable. These studies identified nine commercially viable adaptation solutions, including five in agri-food systems and four in housing, energy, manufacturing, and nature-based solutions.
GCA, FSD Tanzania, and the World Economic Forum’s Africa Business Adaptation Platform are hosting an online webinar to showcase climate adaptation investment opportunities in Tanzania. The webinar will highlight adaptation lending across agriculture, housing, and manufacturing, and complement the upcoming GCA–Bank of Tanzania Climate Adaptation Finance Masterclass. Participants will include regulators, bankers, financial enablers, and adaptation project representatives, with discussions covering climate-related financial risks, inclusive adaptation finance, commercial viability of solutions such as solar irrigation and climate-efficient factory cooling, enabling financial products, and partnerships for scaling adaptation lending.
Key panelists and participating organizations include the Bank of Tanzania, Tanzania Bankers Association, CGAP, CGIAR, and GCA partners, aiming to identify solutions for expanding Adaptation & Resilience Lending in Africa.
