The transition to renewable energy sources in the world and in our continent, in particular, has been a topic that has been widely debated over the last decade due to increased renewable energy generation capacity.
According to World Bank data, in the current scenario, at least 50 percent of Sub-Saharan Africa’s exports are fossil fuels. The export of resources, such as natural gas, crude oil, metals and, in the particular case of Mozambique, coal, generate substantial revenues that contribute approximately 25 percent in the revenue of the governments of these countries. For Africa, however, the transition to renewable energy is not only a way of preserving the environment but also a clear way of boosting economic growth.
In the past, the banks financed companies and projects linked to fossil fuels where, for the most part, the capital provided was channelled to the extraction and production of these. These are not at all, "environmentally friendly" due to the emission of greenhouse gases, one of the causes of the intensification of climate change.
And it is in this sense that several financial institutions, over the last decade, have affirmed their commitment to ensuring a positive impact on the environment through the analysis of applications for funding from these industries. One of the measures verified was the reduction of funding for the fossil fuel industry and a clear increase in the renewable energy sector. In practice, despite continuing investments in both sectors, risk matrices have been created to ensure growth in the portfolio of renewable energy assets and gradually reduce that of the fossil fuel sector.
Mozambique, as we know, has an enormous wealth of natural resources and holds all the ingredients to ensure the generation, on a small and medium scale, of geothermal energy and biomass and, on a medium and large scale, of hydroelectric, solar and wind energy. That is why national banking has gradually shown a greater appetite for investing and supporting the development of the energy sector of the future. For Absa Bank Mozambique this sector is undoubtedly a priority and for this it has trained a dedicated team, focused on creating a specialist portfolio in the renewable energy and infrastructure sector with the aim also of supporting the country in this transition and universal access to energy by 2030.
ALER’s initiative to bring this topic up for discussion and exchange of views in a local context is extremely relevant and we thank you not only for that but also for the opportunity to be part of this debate which will, not only to enrich public knowledge, but also to make known the initiatives under way by national banks in the field of financing and developing the renewable energy sector. We count on your presence to make this event a success with the certainty that today’s funding will determine the world of tomorrow.
Priscila Macamo, Relationship Manager - Corporate and Investiment Banking - ABSA