By Zobia Zulfqar 
African countries continue to face a significant climate financing gap, with officials revealing that the continent requires approximately $155 billion annually to effectively tackle climate change but currently mobilises only about $30 billion each year.
The funding challenge was a key focus during a high-level dialogue on subnational climate finance held at the 2026 Clean Air Transport Finance Academy in Nairobi, Kenya. The event was co-hosted by the Global Covenant of Mayors for Climate and Energy, C40 Cities, and the World Resources Institute, bringing together policymakers, climate experts, and government representatives from across Africa.
Delegates from Ghana, Kenya, and South Africa joined representatives from 12 African cities to discuss strategies for improving access to climate finance at the local government level and ensuring resources are directed toward projects that strengthen climate resilience and sustainable development.
Representing Ghana, Principal Economic Officer at the Ministry of Finance, Eunice Inkum, highlighted several reforms being implemented to improve climate financing and decentralise development planning. She explained that Ghana is applying a “funds follow functions” approach, which seeks to align financial resources with responsibilities assigned to local authorities.
According to Ms. Inkum, the government is strengthening local governance structures through increased allocations under the District Assemblies Common Fund, the introduction of a new National Decentralisation Policy and Strategic Framework, and the implementation of Ghana’s Green Finance Taxonomy. These initiatives are expected to enhance the ability of local governments to access funding and implement climate-related projects.
The National Decentralisation Policy, which covers the period from 2026 to 2030, is designed to replace the previous framework that expired in 2024. The policy aims to empower metropolitan, municipal, and district assemblies by granting them greater authority and resources to address development and environmental challenges within their jurisdictions.
Ghana has also committed to transferring more than 80 percent of the District Assemblies Common Fund directly to local assemblies. This move forms part of broader efforts to strengthen local governance and improve project implementation at the community level. Government allocations to the fund exceeded GH¢6 billion in 2025, reflecting a growing commitment to decentralisation and local development.
Kenya and South Africa also shared their experiences in mobilising climate finance. Kenya’s representative, Isabel Joy Ochieng, outlined the country’s fiscal decentralisation efforts and highlighted financing mechanisms such as County Climate Change Funds and the Financing Locally Led Climate Action Programme. These initiatives help county governments develop investment-ready projects and attract climate funding.
South Africa’s acting Chief Director for Intergovernmental Policy at the National Treasury, Letsepa Pakkies, discussed reforms aimed at strengthening the role of municipalities in climate investment planning and implementation.
The discussions also focused on the Coalition for High Ambition Multilevel Partnerships (CHAMP), an international initiative encouraging national governments to involve local and regional authorities in climate planning and decision-making processes. Ghana and Kenya are among the countries that have endorsed the initiative.
Participants stressed that local governments play a critical role in addressing climate change because they are often at the frontline of responding to environmental challenges such as flooding, drought, air pollution, and infrastructure vulnerabilities.
Climate finance experts at the meeting noted that increasing direct funding to local authorities could significantly improve the effectiveness of climate adaptation and mitigation efforts across the continent.
The dialogue follows growing calls from African city leaders for greater access to climate funding. More than 40 African mayors and governors previously signed an open letter urging finance ministers to prioritise local climate financing and support sustainable urban development initiatives.
As climate impacts continue to intensify across Africa, officials agreed that stronger collaboration between national governments, local authorities, development partners, and financial institutions will be essential to closing the continent’s climate finance gap and achieving long-term environmental resilience.