Landscape of climate finance in Burkina Faso

This report, part of the State of Climate Finance in Africa series, provides a deep dive analysis of tracked climate finance in Burkina Faso in 2019/2020. Following a discussion of climate change policies, strategies, and plans enacted in the country to date, it delves into climate finance committed to and within Burkina Faso, mapping flows along their lifecycles from sources and intermediaries (private and public), the financial instruments used to channel funds (grant, debt, or equity), and through to how finance is ultimately used on the ground (mitigation, adaptation, or dual benefits). While data gaps limit a fully comprehensive assessment, the key purpose of this case study is to inform and facilitate discussions among policymakers and public and private financiers and to identify gaps and opportunities for scaling climate finance in Burkina Faso.

They key findings are that in 2019/2020, USD 567 million of public and private capital was invested in climate-related activities in Burkina Faso, which is only 13% of its total needs (USD 4.1 billion by 2050). More specifically:

• The investment gap for priority sectors looms large in the Burkina Faso climate finance landscape, given the estimated USD 4.1 billion needed to deliver on the NDC. From the adaptation angle, agriculture represents the highest investment costs in the country (USD 1.1 billion) followed by ecosystem services and water, according to the NDC.
• Climate finance to Burkina Faso was largely provided by public actors (USD 452 million, 80%), especially for adaptation activities, while the private sector lagged behind (USD 116 million, 20%). It is important to note that the current absence of a domestic budgetary climate tagging framework limits a robust assessment of climate finance committed by domestic governments, whether state or local.
• International public climate finance flowing to Burkina Faso from multilaterals and partner countries accounted for USD 431 million or 76% of all climate finance, the majority of which was channelled as low cost debt (42%) and project level debt (21%).
• Corporations provided a significant share of private climate finance (USD 76 million, 65%) with a relatively smaller role played by commercial financial institutions (USD 28 million, 24%), and institutional investors (USD 12 million, 10%).
• The majority of climate finance was committed for energy systems (USD 249 million) followed by AFOLU (USD 148 million), cross sectoral investments (USD 95 million), and water and wastewater (USD 50 million).