DG Okonjo-Iweala attended in Sharm El-Sheikh, Egypt, the “COP27 Leaders' Event: Accelerating Adaptation in Africa”, jointly organized by the African Union (AU) and the Global Center for Adaptation (GCA). The event was an opportunity for the international community to galvanize funding pledges for climate-resilient actions, particularly through the Africa-owned and Africa-led Africa Adaptation Acceleration Programme (AAAP).

In her intervention, DG Okonjo-Iweala stressed the importance of financing for adaptation and mitigation, noting that it needs to be matched with sound trade policies. She recalled that the COVAX Facility had enough money to buy COVID-19 vaccines but there were no vaccines to be bought, stressing that this scenario should be avoided in the context of the climate crisis. 

She referred to the WTO's 2022 World Trade Report that recommends trade policies to support both adaptation to and mitigation of climate change. “Trade can lower the costs of adaptation in Africa, it can drive down poverty, deploy the necessary technologies and ensure that goods continue flowing”.

The AAAP was developed by the African Development Bank (ADB) and the GCA to mobilize US$ 25 billion by 2025 to implement, scale and accelerate climate adaptation across the African continent. Patrick Verkooijen, CEO of the GCA, announced that African countries had already raised half of the US$ 25 billion originally envisioned to accelerate and scale climate adaptation efforts in Africa. 

The UN Secretary-General, Antonio Guterres, reminded participants that Africa does not contribute much to greenhouse emissions but is on the frontline of experiencing the worst impact of climate change. He called on international financial institutions to explore ways of leveraging private funds to increase the access to money for adaptation and mitigation projects.

President William Ruto of Kenya, President Nana Akufo-Addo of Ghana, President Macky Sall of Senegal, President Hassan Sheikh Mohamud of Somalia, President Andry Rajoelina of Madagascar, Chancellor Olaf Scholz of Germany, Prime Minister Jonas Gahr Støre of Norway and Prime Minister Alexander De Croo of Belgium, among others, participated in the event.   

Director-General Okonjo-Iweala also delivered opening remarks at an event entitled “Business Action in Trade to Accelerate the Low-Carbon Transition”, jointly organised by the WTO and the International Chamber of Commerce (ICC). She underlined the role of trade, the WTO and the multilateral trading system in supporting the world's decarbonization efforts but said more needs to be done.

“International trade allows low-carbon technologies to spread widely. It also allows to create and connect markets for low or near-zero carbon products. That's where the WTO fits in,” she said, underlining that the WTO is the only organization dealing with trade rules at the global level. However, she emphasized that global trade rules and trade practices need to be updated to respond better to climate change challenges.

DG Okonjo-Iweala noted that around 70 carbon pricing initiatives exist globally and have been adopted in 46 national jurisdictions. “Of course, not everyone can move at the same pace — some regions will be fast movers and others will need a longer time to make the transition. But what is important is to ensure compatibility, consistency, and transparency in these measures,” she said. “We cannot afford fragmentation as it is a recipe for failure. It is a loss for trade as it generates trade frictions and a loss for climate action as it increases business confusion and unpredictability.”

In this regard, she noted that 89 WTO members representing approximately 90% of world trade are involved in at least one of three major environment and climate initiatives at the WTO:  trade and environment sustainability, fossil fuel subsidies reform, and elimination of trade in polluting plastics.

COP27 also heard about how extreme weather conditions and climate-induced disasters have crippling effects on small and medium-sized enterprises (SMEs), which often lack the resources that are needed to adapt to rapidly changing climatic conditions.

At an event jointly organized by the WTO and the International Trade Centre (ITC), participants agreed that SMEs' resilience needs to be strengthened to cushion climate shocks and to build back greener and better through sustainable solutions. They also discussed how trade policies can be tailored to SMEs' needs so that they can access climate finance, prioritize investments in mobilizing resources, and increase their overall trade competitiveness in global markets.

WTO Deputy-Director General Jean-Marie Paugam highlighted both organizations are increasingly working on leveraging trade to contribute to climate outcomes. “Our work on trade and climate change is not only complementary, but we also significantly impact each other's work. The WTO's work is located upstream, providing policy and technical expertise on trade and climate nexus issues to rule-making. ITC's work is located downstream, providing critical technical assistance to a global network of MSMEs transitioning to greener circular production and trade,” he said.

DDG Paugam noted that the WTO's main aim is to focus on African SMEs, as they are central to efforts to tackle climate change and are the future of trade in the continent. “According to ITC, 60% of African SMEs that greened their businesses said it led to new, higher quality and more products, access to new markets, or lower input costs. They were also better positioned to tap the growing pot of green finance,” he added.

ITC Executive Director Pamela-Coke-Hamilton stressed climate change massively affects SMEs and their suppliers. Physical risks, such as extreme weather events, flooding and higher temperatures, impact on supply chains, damage infrastructure, affect production facilities and reduce soil yields. “For businesses, large and small, this means greater uncertainty, higher risks and declining profit margins. It means facing higher costs, fluctuating quality and disruptions to delivery of products to market,” she said.

Ms Coke-Hamilton emphasized that while everybody is talking about financing, money is not the problem when it comes to SMEs. “Funding exists but it is not getting to small businesses because they do not know about it, and if they do, they don’t have the time or know-how to apply for it. We must bridge the financing gap — not just making it available, but making it accessible,” she declared.

Kemo Fatty, founder and Executive Director of GreenUp in The Gambia, drew attention to the work his organization does with entrepreneurs and farmers across the country to deliver sustainable farming practices. Highlighting the need to promote conservation and strive for environmental justice, he stressed the importance of raising awareness on climate change and environmental issues so that farmers in developing and least developed countries (LDCs) can make a sustainable livelihood through agroforestry.

The event also heard the view of Dr Dhanush Dinesh, founder of Clim-Eat — a think tank working to bridge science and policy for food and climate. He noted that the institutional ecosystem is not supporting action and that needs to be changed, particularly by supporting start-ups, scale-ups and grown-ups in the private sector to contribute to greater climate action.