Managing Climate Risks and Disasters in Africa: Is there a Business Opportunity?

In recent years, extreme weather and climate events have taken many lives and caused billions of dollars in economic losses. Is climate change leading to increases in the number and severity of extreme events? How do social and environmental factors interact with weather and climate events to create disasters? And what is the role of business in making economies more resilient to extremes? This week at the World Economic Forum on Africa in Addis Ababa, we have been exploring these questions.

In March, the Intergovernmental Panel on Climate Change (IPCC) released a Special Report that assesses the latest scientific information in an attempt to answer these questions. According to the IPCC, evidence suggests that climate change has led to changes in climate extremes such as heat waves, record high temperatures, heavy precipitation and drought in many regions in the past half century. The Special Report confirms that in 2011, we experienced the most expensive climate-related economic losses to date, costing US$ 380 billion, and losses are expected to double every 12 years.

What does this mean for Africa? The continent has some of the highest levels of climate vulnerability in the world, due to its heavy reliance on agriculture and the rapid move towards urbanization with settlements springing up in many cities with poorly designed streets and infrastructure. Add to this more severe and frequent weather and climate extremes and we may be seeing African coastal cities subject to flooding and deaths from extreme heat exposure and disease. At the same time, the Horn of Africa and other key agricultural regions are more at risk for more severe drought and floods, which countries such as Kenya have recently seen, with devastating impacts on food production on the population and the economy. Businesses in the region will experience higher costs due to loss of worker productivity, supply chain disruption and insurance losses.

What can government and business do to manage climate risks and disasters in Africa? The discussion among science, business and government leaders concluded that while the IPCC has given a stark forecast, there may be a silver lining to the clouds:

• Government must strengthen existing risk management measures to prepare for the future. This includes implementing early warning systems, land use planning, development and enforcement of building codes, improvements to health surveillance, and ecosystem management. It also requires removing silos between economic, environmental and planning agencies to develop a comprehensive climate disaster plan. Mozambique is a country that has initiated strong disaster management planning, and as a result it has experienced much lower impacts than its neighbours.
• New and existing public-private partnerships for sharing and risk assessment tools must be strengthened, including the United Nations Economic Commission for Africa’s Climate for Development partnership with the African Development Bank, which offers funding for adaptation projects and a platform for sharing best practices.
• There are investment opportunities related to climate adaptation, including improving building construction and efficiency, introducing more productive (and more resilient crops), initiating water resource planning and efficiency and developing new insurance products to mitigate risks. The World Economic Forum offered to facilitate some “proof point” partnerships to demonstrate that progress can be made.
• At the international level, momentum should be accelerated towards reducing greenhouse gas emissions that are causing these climatic risks – perhaps by attacking the highest-potency gases first.

Author: is Director, Head of Climate Change Initiatives at the World Economic Fourm

Image: A Maasai guard stands near a solar panel at the Safaricom Base Transmission Station (BTS) in Kajiado, 100 km (62 miles) south of Nairobi. REUTERS/Noor Khamis (KENYA ENERGY SOCIETY BUSINESS)