Green finance in Africa: mapping progress, challenges and prospects

Abstract

Abstract This article examines the growth of green finance in Africa using Scopus data from 2012 to 2024. Even though Africa contributes less than 4% of global greenhouse gas emissions, the continent is extremely vulnerable to the effects of climate change. Addressing climate change and promoting sustainable development in Africa requires green finance to support environmentally sustainable projects. However, insufficient institutional and policy frameworks, reliance on foreign investment, high perceived investment risk, underdeveloped green bond markets, a lack of low-carbon infrastructure, and a lack of effective public–private partnerships (PPPs) are some of the obstacles Africa faces in successfully raising capital for green finance investments. To address these challenges, an integrated framework is developed, comprising six pillars: strengthening institutional frameworks, mobilizing financial resources, enhancing engagement, ensuring equitable distribution, building capacity and governance, and promoting sustainable practices. Potential avenues for further research include determining the incentives needed to promote both foreign and domestic investment in the green economy and how African countries can strengthen public–private partnerships (PPPs) to increase green investments.