Climate finance readiness: A review of institutional frameworks and policies in Kenya

ABSTRACT

A significant increase in low carbon investments is required to limit global warming to less than 2° C. For example, about USD 900 billion should be invested annually in the energy sector up to 2030 to meet this target. Climate finance provides opportunities for investments in climate-smart projects. Such investments could enhance Africa’s adaptive capacity, food security and economic growth. Nonetheless, Africa lags behind in the access and utilisation of these funds. Climate finance readiness plays a major role in enhancing access to these funds. This paper analyses policy and institutional frameworks that would enhance Kenya’s readiness for climate finance. Publicly available scholarly articles, government and development partners reports were profiled using the following key words: Kenya, climate change, climate mitigation and climate adaptation. Then the keywords; climate finance, climate policy and legislation were used to identify the most relevant publications. These were reviewed to assess Kenya’s readiness for climate finance. The study finds that considerable efforts have been made to enhance Kenya’s readiness for climate finance as evidenced by the formulation of climate-related policies, legislation and the creation of institutions tasked to address climate change. Nonetheless, some policy areas could be enhanced. For instance, the role of the private sector could be better recognised and supported. This study provides an important reference for the government, development partners and private sector involved in negotiations and decision making on climate financing in Kenya.

KEYWORDS:

• climate finance
• climate investments
• adaptation
• mitigation
• climate finance readiness

Public interest statement

The changing climate is reducing the performance and resilience of ecosystems that support the livelihoods of millions of people in Sub Saharan Africa (SSA). Climate finance offers funds for climate smart investments, enabling residents of developing countries to adapt to the negative impacts of climate change. Access and utilization of these funds presents an opportunity for Africa to enhance its adaptive capacity, food security and economic growth. Even so, Africa’s access and utilization of climate funds is considered low. Climate Finance Readiness (CFR) plays a major role in facilitating access to these funds. It is against this background that this study examined Kenya’s CFR. It was found that great efforts have been made to increase Kenya’s CFR. This is evidenced by the formulation of a range of climate-related policies, legislation and the establishment of climate-oriented institutions. However, areas such as the specific roles played by different stakeholders in key institutions and estimation of the finance requirements for different sectors need improvement

Author contributions

All authors made contributions to the manuscript’s development and consented to the submission for publication. Mercy Kiremu established the methodology, conducted analysis, interpretation and wrote the paper with guidance from Frank Scrimgeour. James Mutegi supported with the review of the manuscripts and additional interpretation of the results while Richard Mumo supported with writing reviews, editing and validation.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This research received no external funding.