• The UK’s Minister of State for Development, Anneliese Dodds, announced up to £100 million for MOBILIST, the UK’s flagship public markets programme.
• New funding and partnerships will unlock investment opportunities, as part of a new development approach supporting sustainable economic growth overseas.
• Government to partner MOBILIST to deliver on the Plan for Change by tackling climate change and driving growth at home.

Efforts to address the climate crisis and boost growth in the Global South and at home will be enhanced under a partnership approach between the government and the UK financial sector, Anneliese Dodds, the UK’s minister for Development announced on Monday, 3 February.

The Minister announced up to £100 million for the UK’s flagship public markets programme MOBILIST which will provide businesses focused on delivering the SDGs with the anchor funding and expert advice they need to list on stock exchanges around the world, allowing them to attract significant sums of additional private investment.

She also celebrated the issuance of the first Climate Investment Fund (CIF) Capital Markets Mechanism (CCMM) bond last month, which raised $500 million (approximately £400 million) for energy and clean technology projects in low- and middle-income countries.

The CCMM, launched by the Prime Minister at COP29, is a new financial mechanism to leverage future loan repayments by issuing bonds on capital markets.

Speaking at the London Stock Exchange, Minister Dodds praised the “expertise, experience and dynamism” of the UK’s financial services sector, and pledged to put this expertise “at the heart of how we meet the opportunities and challenges of our time”, including accelerating delivery of the UN’s Sustainable Development Goals (SDGs). These seek to address global challenges, including poverty, inequality, and climate change, to achieve a better and more sustainable future for all, by 2030.

Minister Dodds set out how investment in the Global South is an opportunity for UK financial services “to marry investment in the economies and technologies of the future, with the experience and expertise of the City of London”, adding that the government will hold up its end of the bargain by working internationally to reform the global financial system to provide greater opportunity and stability.

Anneliese Dodds, minister for Development, said:

“With businesses and the government working hand in hand to drive investment in the Global South, we can unlock growth, jobs, trade, investment, and pride in our economy overseas and here at home.

“This government is enabling the financial services sector to flourish and use its expertise and depth of capital to invest in the markets and technologies of the future.

“Through partnerships like this, we will deliver on the Plan for Change, drive domestic growth, and create a world free from poverty on a liveable planet.”

The MOBILIST funding is expected to generate between £400 million and £600 million of new investments in businesses across emerging markets in Asia, Africa, and Latin America.

These investments will support economic growth, sustainable development, and climate action in local markets.

As Monday’s announcements demonstrate, this government’s modern approach to development focuses on harnessing the power of the private sector in mobilising the finance emerging markets need to grow.

This will create future export markets for the UK and new overseas investment opportunities, supporting domestic growth and delivering on the government’s Plan for Change. It will also make the UK safer and more stable by tackling the drivers of conflict, climate crises and economic decline in partner countries.

Kerry McCarthy, UK’s climate minister, said:

“This is a historic moment for tackling the climate crisis, with the first bond raising $500 million to accelerate the global clean energy transition and support the flow of climate finance to developing countries.

“Public finance alone cannot tackle the scale of this challenge, and this mechanism will help leverage the private finance needed to support those on the frontline of a changing climate.

“Its listing in the UK positions London as a green finance capital. By working with partners such as the World Bank the UK can drive the action needed to grow the economy and reap the rewards of net zero.”

Minister Dodds made the announcements during a speech to the UK financial sector, including pension funds, insurers, banks, and development finance organisations, after joining a market opening ceremony at the London Stock Exchange.

Julia Hoggett, CEO of the London Stock Exchange, added:

“Flows of investment are vital to generating sustainable growth both in the UK and around the world. London’s capital markets have long played a leading role in driving flows of capital to where they need to go, and we welcome the focus on fuelling growth and supporting the just transition to net zero.

“As part of these efforts, we are proud to celebrate the listing of the Climate Investment Funds’ Capital Markets Mechanism on the London Stock Exchange. This pioneering bond issuance programme not only brings a new financing tool to our market but is facilitating critical investment in sustainable and clean assets.”

Mitigation efforts, aimed at reducing carbon emissions, see roughly 90% of climate spending today, while A&R, which focuses on reducing the vulnerability of communities and ecosystems to climate impacts such as rising sea levels and extreme weather events, is greatly under-invested.

One key reason for this is the challenge in measuring the impact of A&R investments. Unlike mitigation, where success can be quantified by the reduction in greenhouse gases, A&R lacks a unified metric or a way of measuring a disaster that didn’t happen.

This is particularly problematic for countries like Nigeria, where climate vulnerabilities are diverse and region-specific, and is a key barrier to attracting private-sector investment, crucial for implementing effective A&R strategies.

To address this challenge, a proposed framework—the Framework for Resilience and Adaptation Investment Measurement and Evaluation (FRAIME)—has been developed which aims to standardise the measurement of A&R impacts.

This should enable public and private investors alike to identify high-impact projects, align these projects with national adaptation plans, and ultimately serve as a global benchmark for A&R efforts.

The goal is to unlock and attract the necessary capital to assist many lower- and middle-income countries (LMICs) like Nigeria adapt to the escalating effects of climate change.

The need for adaptation and resilience in Nigeria

As of 2023, only a third of LMICs had submitted comprehensive National Adaptation Plans (NAPs) to the UN Framework Convention on Climate Change (UNFCCC), and Nigeria is no exception.

Although adaptation finance has increased in recent years, it still falls short of what is required to meet the growing needs – a gap that by 2030 is estimated to be around $212 billion annually for A&R investments for LMICs—a figure that dwarfs current funding levels.

Nigeria’s high vulnerability to climate change and significant risks faced from extreme weather events, changing rainfall patterns, and rising temperatures, all of which threaten its agriculture, infrastructure, and overall economic stability, requires the urgent full integration of A&R into its national climate strategy, something, which largely due to the same measurement challenges being faced globally, has yet to take place.

The complexity of measuring the impact of A&R initiatives has contributed to the lag in investment but a further contributing factor is the variable effectiveness of such projects due to factors such as the degree of warming, regional vulnerabilities, government policies, public behaviour and others.

This is true in Nigeria where climate vulnerability varies greatly by region. For instance, a project that strengthens coastal defences in Lagos might be highly effective, but the same type of project would have little relevance in the drought-prone northern regions. This geographic specificity, combined with the uncertainty of future climate scenarios, makes it difficult to assess and compare the effectiveness of A&R projects across different contexts.

Moreover, existing efforts to standardise A&R metrics, such as those from the Global Goal on Adaptation and the Climate Bonds Initiative, are still in their early stages and have not yet been widely adopted.

A case in point is Lagos, Nigeria’s largest city and economic heart, where the climate conversation is urgent given its coastal low-lying topology, pre-existing storm conditions, ill-prepared infrastructure, and dense population.

The Lagos Climate AI model that we developed identified a staggering $39Bn cost of inaction, 27X the state’s current entire annual budget, due to the impact of rising sea levels, extreme rainfall, and extreme temperatures. Up to 3 million Lagosians could be underwater by then.

We have worked with the Lagos State Government to produce the detailed, integrated, and comprehensive Lagos Climate Adaptation and Resilience Plan (LCARP) based on those deep climate analytics.

We took an analytical approach to pinpoint risks across the city, such as specific infrastructure inundated by expected sea level rise and identified $8Bn of A&R investment interventions to mitigate the staggering cost of inaction.

This work, presented at COP29,  will help put the city on the pathway to becoming Africa’s model city for climate resilience.

Implementing the FRAIME framework in Nigeria

The FRAIME proposes a comprehensive approach to measuring A&R impacts, which could be particularly beneficial for Nigeria. It includes three core components:

1. Policy metrics: These metrics help shape government decisions by quantifying the cost of inaction and the potential value at risk. For Nigeria, this could involve detailed assessments of how climate change will impact key sectors like agriculture, health, and infrastructure.
2. Investment life cycle metrics: These metrics track the progress of A&R investments over time. In Nigeria, this could mean monitoring the implementation of projects such as irrigation systems in drought-prone areas or flood defences in coastal regions.
3. Impact metrics: These metrics evaluate the actual outcomes of A&R investments, such as reduced crop losses due to improved irrigation or fewer casualties from flooding. By applying these metrics, Nigeria could better demonstrate the effectiveness of its A&R strategies and attract more investment.

Nigeria’s case for action

Nigeria’s exposure to climate change necessitates an urgent and coordinated response. Adopting a standardised framework like FRAIME could play a critical role in guiding critical A&R investments such as those identified in LCARP, and ensuring that they deliver measurable benefits.

Moreover, this framework can help Nigeria align its national adaptation efforts with global standards.

By focusing on the country’s unique vulnerabilities and mobilising the necessary capital, Nigeria can build resilience against climate impacts and secure its future in an increasingly warming world.

Alongside announcing plans to appoint new Special Representatives for Climate Change and for Nature, the Foreign Secretary also pledged to unlock more climate finance and reverse the decline in global biodiversity – addressing systemic inequalities and injustice globally.

Foreign Secretary, David Lammy, said:

“This Government has set a landmark goal – to be the first major economy to deliver clean power by 2030. We will leverage that ambition to build an Alliance committed to accelerating the clean energy transition. And today we are firing the starting gun on forming this new coalition. While some countries are moving ahead in this transition, others are being left behind. “We need to accelerate the rollout of renewable energy across the globe in the way that this Government is doing at home.” 

The Alliance will focus on driving global investment and finance to close the clean power gap by helping more countries to leapfrog fossil fuels and transition to power systems with renewables at their core. It will work to speed up the supply of critical minerals and inject impetus into expanding energy grids and storage. This will help to increase clean energy innovation across the globe – sharing knowledge and technology to make Net Zero Power a reality, everywhere.

Continuing, Lammy said:

“This crisis is not some discrete policy area, divorced from geopolitics, conflict and insecurity. The threat may not feel as urgent as a terrorist or an imperialist autocrat. But it is more fundamental. It is systemic. Pervasive. And accelerating towards us. Today, I am committing to you that while I am Foreign Secretary, action on the climate and nature crisis will be central to all the Foreign Office does. This is critical given the scale of the threat, but also the scale of the opportunity.” 

The Foreign Secretary also committed to united Government team that will use the diplomatic and development weight of the Foreign Commonwealth and Development Office (FCDO) to push for ambitious pledges on finance and reduced emissions at COP29.

This diplomatic weight will be reinforced by new UK Special Representatives for Climate Change and for Nature.

These representatives will report to the Foreign Secretary, together with Ed Miliband and Steve Reed respectively, and will help to galvanise British engagement with partners across the world, forge genuine partnerships on climate change and mark a diplomatic drive to increase global ambition focused on clean power, climate finance, adaptation and resilience and biodiversity.

[Featured Photo Credit]