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Climate finance has become a defining lever for global competitiveness and resilience, particularly as capital flows increasingly favour low-carbon, climate-aligned growth. International agreements, including the Kyoto Protocol and the Paris Agreement, place clear obligations on wealthier nations to mobilise financial support for countries most vulnerable to climate impacts, despite contributing least to global emissions. Underlying climate risks and accelerating environmental pressures underscore the urgency of deploying large-scale investments that can drive both meaningful emission reductions and long-term adaptation.
3 December 25
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Venture Capital and Private Equity are driving significant advancements in climate solutions globally by not only bridging the gap between innovation and commercial scale but also actively funding both these phases. On the African continent, this dynamic is equally visible but presents unique challenges and opportunities. According to the 2024 AVCA Report, 17% of private investment recipients in Africa were climate-related ventures, underscoring the growing interest of investors in climate-tech startups and resilience-building businesses, particularly in renewable energy, clean infrastructure, and climate-focused financial services such as carbon markets. One key trend in 2024 was the emphasis on a ‘just transition’, with investors, sector participants, and international institutions alike, with nearly one in five deals going to climate-focused ventures, according to the African Climate Policy Centre. However, the aggregate investment value in this segment in 2024 was approximately USD 1.5 billion, less than half the USD 3.4 billion recorded in 2023, reflecting market fluctuations and capital deployment challenges.
This article explores the evolving role of venture capital and private equity in global and African climate finance, the innovative mechanisms shaping the sector, and the strategic opportunities that could unlock Africa’s green transition.
Click here to download and read the full article.
Should you have any questions on this legal alert, please do not hesitate to contact Dominic Rebelo or Edwin Odundo.
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Contributor
Edwin Odundo – Senior Associate