South Africa is facing several economic challenges, as well as deteriorating natural resources leading to climate change, global warming and biodiversity loss.
This further contributes to the inequalities between rich and poor communities, which results in the overall decline of economic growth in South Africa. So, to solve this problem, South Africa, much like the rest of the world, is trying to move towards a green economy.
What is a green economy?
A green economy refers to an economy that finds solutions to problems which cause environmental risks. These include risks such as waste generation, emissions and more.
It aims to prioritise access to sustainable development initiatives which benefit the environment, typically through low-carbon, resource-efficient and climate-resilient approaches.
In the South African context, as defined by the Department of Environment, Forestry and Fisheries, a green economy is a “system of economic activities related to the production, distribution and consumption of goods and services that result in improved human well-being over the long term. While not exposing future generations to significant environmental risks or ecological scarcities.”
The challenges South Africa faces with green economy projects
A few of the challenges South Africa faces in its quest to fully transition into an inclusive green economy include the poor understanding of what green economy is, and how it will benefit the country’s economic future.
It also includes viewing green economy initiatives as “add-on” or emerging sectors with a separate mandate from the overall inclusive economic growth and the lack of access to project funding to push forward green economy sustainable infrastructure initiatives.
How DBSA contributes to a green economy
South Africa has included a green economy in the National Development Plan: Vision 2030, which is designed to alleviate poverty and reduce inequality in South Africa by 2030.
According to the Green Economy Policy Review Of South Africa’s Industrial Policy Framework, an inclusive green economy “is not only an environmental matter but primarily a socioeconomic question with core implications for economic development. It requires a new model of development to shape a more sustainable economy and society.”
This is why, as one of the few development finance institutions, the Development Bank of Southern Africa is committed to helping create green cities and towns in South Africa, as well as green economy jobs in South Africa.
What are green economy jobs? These are jobs which are specifically in sectors that produce environmentally-friendly resources and services. The Bank’s Green Climate Fund, which operates in the transport, energy, water and sanitation industries is an example of initiatives targeted at creating green economy jobs.
The Green Climate Fund was established in partnership with the Department of Environment, Forestry and Fisheries. This infrastructure fund is a national mechanism that aims to provide catalytic finance solutions to facilitate investment in high-impact and sustainable green initiatives within the country and the countries in the Southern Africa Development Community regions.
Through this fund, we help facilitate the preparation of innovative and risk-sharing projects that contribute towards low-carbon, climate-resilient and resource-efficient developments to help deliver impactful economic, environmental and social benefits.
Final thoughts
The decline in environmental and natural resources has created unfavourable economic conditions, which have since resulted in slow economic growth, and an increase of inequality in various communities. Acknowledging the importance of a green economy is crucial, and that’s why the Bank facilitates green economy initiatives in South Africa.
To help with the implementation of progressive green economy activities which will support poverty reduction, job creation and contribute to the development and economic growth of the country. Overall, the concept of a green economy is focused on building a prosperous future for every citizen in South Africa, and other parts of the world.