From the Union Buildings
The severe storms that have lashed parts of the Western Cape recently are a devastating reminder that extreme weather is becoming more frequent and intense.
The effects of climate change are worsening. We recall that in 2022 parts of KwaZulu-Natal experienced the heaviest rains in more than half a century, leading to the deaths of more than 300 people and causing catastrophic damage to homes, businesses and key infrastructure. This year alone, there have been severe storms and floods in some parts of the country and heatwaves in others.
Like many developing economy countries, South Africa is extremely vulnerable to the effects of climate change. As these countries, we carry the least responsibility historically for the greenhouse gas emissions that cause global warming. Beyond the cost to human health, safety and livelihoods, climate change is very much an economic issue.
Agriculture, tourism, mining and manufacturing are just some of the areas of economic activity that could be adversely affected by climate change. Then there is the equally dire effects on water security, food security, public infrastructure, human settlements, health care and education.
The increasing frequency of disasters has an impact on public finances. On the one hand, disasters affect economic growth and lower tax revenues. On the other hand, they require increased expenditure on disaster relief, health care and other forms of social support for affected communities.
As part of the effort to ensure that our economy is resilient in the face of climate change, the National Treasury recently hosted a symposium in partnership with the Presidential Climate Commission, on financing our country’s climate actions.
This critical seminar brought together representatives from government, industry, academia, civil society as well as climate experts and development partners to discuss how to scale up climate action across the economy and society.
South Africa is undertaking a range of policies and programmes to both adapt to climate change and to mitigate its impact.
We embarked, for example, on the Renewable Energy Independent Power Producer Procurement Programme. This has been a success, attracting over R209 billion in investment and adding much-needed capacity to our electricity grid.
The Just Energy Transition Investment Plan sets out a plan that will drive huge investments in the electricity grid, green hydrogen, electric vehicles, economic diversification and skills development. We continue to explore opportunities to meet our emissions reduction targets in industries like mining, green hydrogen production and electric vehicle manufacturing.
The symposium on building resilience in our economy was informed by both national and global realities.
The first reality is that the carbon intensity of our economy has become unsustainable. The world is moving towards greener economies. These include a number of our major trading partners, who are taking measures to decarbonise that will in the long run affect the competitiveness of South Africa’s exports to these markets.
Secondly, as a signatory to the Paris Agreement to Combat Climate Change, we have an obligation to reduce emissions and make a fair contribution to the global climate change effort.
Thirdly, low-carbon development is necessary if we are to successfully adapt to and mitigate the effects of climate change and build resilient communities.
We have often said that we will decarbonise at a pace and scale that the country and our economy can afford, and mitigate the impact of such a transition on all sectors of society, particularly vulnerable workers and communities
The increasing frequency of extreme weather events is a stark reminder that we have to accelerate the pace of our efforts
We need to use our fiscal policy – how we manage public finances – to support our response to the shocks of climate change and to advance the just transition to a more inclusive, resilient and sustainable economy.
We need to work with social partners and development institutions to marshal investment into green economy initiatives and secure finance for local adaptation and mitigation efforts. We need to raise funds to support industrial policy that facilitates the just energy transition.
It is essential that countries with developed economies fulfil their financial commitments to support the climate actions of countries that are most affected, including making funds available for the loss and damage that these countries experience due to climate change.
Through the symposium and through the ongoing collaboration across society and with international partners, we are strengthening the effort to make our economy and society more climate resilient. In doing so, we are enabling our country to respond more effectively to the challenge of climate change and better weather the storms to come. ¥
From the desk of the President was first published on the 15th of July 2024.
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