Mminele dismisses 'speculative coverage' about climate loans to SA

• A leaked draft document shows that the majority of the $8.5 billion in climate funding pledged to SA will comprise loans, according to a report.
• Less than 1% of the funds will be allocated towards social investments needed to enable a just transition.
• Daniel Mminele, leading negotiations on the funding, says the leaked draft does not match the final financing package, which will be made public soon.

Presidential Climate Finance Task Team head Daniel Mminele has criticised "speculative coverage" about a leaked draft document that says that the $8.5 billion (R155 billion) in climate funding pledged to South Africa will mostly consist of loans. 

Mminele told News24 that said the final "accurate" version of the plan differs from the leaked draft.

According to a report on the draft document by Climate Home News, 97% of the package will be loans. More than half (54%) or R84 billion will be at concessional rates. Through their development agencies, Germany and France will provide under half of these funds at R22 billion and R18 billion, respectively. The Climate Investment Funds initiative, Accelerating Coal Transition, will provide the remaining R48 billion through multi-laterals like the World Bank.

The remaining 43%, or R68 billion, is to comprise commercial loans and investment guarantees (to crowd in private investors). The UK will provide the largest share of these funds, along with the EU and US.

About R4.2 billion, or less than 3% of the monies, will be grants from the donor countries.

Less than 1% of the funding is directed towards social investments to ensure a just transition for workers and communities dependent on the coal value chain.

Responding to questions from News24, Mminele noted that there had been a "fair amount of speculative coverage" on the Just Energy Transition Investment Plan (Jet-IP), especially based on leaks of an earlier draft of the plan.

"The numbers cited do not reflect the current status of the financing package, details of which will be provided once the plan is released to the public. Government plans to share the accurate and final version of the Jet-IP with the public in the near future," Mminele said.

Cabinet last week approved the Jet-IP, and said the inter-ministerial committee on climate change would hold a media briefing outlining further details. 

READ | Cabinet gives the nod for $8.5bn just transition investment plan

Speaking at the Standard Bank climate summit last week, Forestry, Fisheries and Environment Minister Barbara Creecy noted the work of the Presidential Climate finance Task Team to ensure the terms of the finance do not worsen the country's fiscal position.

She said the plan is to present the Jet-IP at COP27, to be held in Sharm el Sheikh, Egypt, in November.

This will be followed by a public consultation programme, which has not been well received by civil society. Executive director of the Presidential Climate Commission Dr Crispian Olver also criticised the "secrecy" of the plan and called for public engagement:

Speaking at the Civil Society Town Hall on Climate Finance and the Jet-P, held in Johannesburg this past weekend, Hlengiwe Radebe, civil society engagement officer at WWF SA, raised concerns over an ongoing lack of clarity on the terms and conditions of the financing.

Although civil society had engaged with the presidential task team, the consultation process was found to be lacking. "There was limited information [on the investment plan]," Radebe said.

Civil society was told that their contributions would be addressed in the final investment plan. "We don't know that, we will see once that investment plan is made public," she said.

Civil society believes there have not been enough stakeholder engagements, and that these have lacked transparency on the financing deals, Radebe added. 

*With Carol Paton

All amounts are based on the rand-dollar exchange rate as at 24 October 2022.