EAST AFRICA: CLIMATE-VULNERABLE AND DEBT-RIDDEN

BY JAMES KAHONGEH & SAADA MOHAMED 

East Africa is one of the most vulnerable regions to climate change impacts, with multiple incidents of flooding and periods of drought now occurring every year.

But this region is also one of the most unprepared in responding to climate disasters.

Yet, what has experts on edge is the level of debt that the trio now face.

In the last decade, East African countries have been buckling under the weight of external debt. The trio now spends a significant proportion of their Gross Domestic Income (GNI) to service their mounting debt.

But just how grave is the situation?

Kenya, the largest economy in East Africa, is facing the highest risk of debt distress among the three East African countries, with borrowings amounting to Sh5.09 trillion as of January 2025.

For the last decade, the debt situation in East Africa has gone from worrying to grave.

Which Way for East Africa: Adaptation or Mitigation?

Many African countries struggling with the impacts of climate change have been focusing their attention and resources on adaptation to build the resilience of their communities and cushion their economies from climate shocks.

But what do their last NDCs say about their priorities up to 2030?

The table below illustrates the share of financing for adaptation and mitigation initiatives among East African countries.

So, who funds adaptation in East Africa?

East Africa is one of the regions most vulnerable to climate change impacts, with frequent floods and droughts. But where does the money for adaptation interventions come from?

Over the seven years between 2015 and 2022, the share of adaptation-related development finance committed to these three countries amounted to $7.79 billion, accounting for about 52% on average.

This flow, however, includes 50% of cross-cutting finance committed to address adaptation and mitigation needs. The adaptation-specific value is even lower than $7.79 B. 

Finance needs vs commitments 

These flows barely cover about 11% of the adaptation-specific financial needs of these countries as outlined in their NDCs.

Commitments vs disbursements 

The reported flows for adaptation are merely commitments as opposed to actual disbursement of funds for adaptation objectives in these countries. This makes it difficult to track and measure real impacts, as these can only be realised once the climate finance is disbursed and projects are implemented in the developing countries.

Climate vs development finance 

These finance flows are based on the public international climate-related development finances committed by the developed countries.

This illustrates how developed countries draw climate finance from the existing inadequate development finance as opposed to it being new and additional.

Consequently, this creates pressure for resources by climate change-related demands and critical socio-economic development goals of vulnerable countries. Progress on SDGs is stalled as a result.

Specifically, most of the climate-related development adaptation finance comes for East African countries from the following sources: 

In terms of the common financial instruments, 61% of the money provided comes in the form of concessional loans, 32% in grants and 7% in non-concessional loans.

Interestingly, out of the total $7.79 billion, only 64% represent the grant-equivalent value of the reported commitments when climate loans (concessional and non-concessional) are discounted to account for debt service payments, interest, administration fees and other costs associated with debt burdens.

The increasing use of loans for climate worsens the debt crisis, says the International Institute for Environment and Development (IIED). It is even worse when these loans are reported at face value. This fails to reflect the debt burden and financial benefit to recipient countries.

Unequal climate provisions 

But it is the glaring inequity and lack of inclusivity in climate finance provision that is even more worrying. Even though women and marginalised communities are disproportionately affected by climate impacts, only 1% of reported finance went through local, devolved institutions, making it hard to reach smallholder farming communities, for instance. The largest share, about 66%, is channelled through the national government, with the risk of diversion to other budgetary needs.

Providing adaptation finance in a locally led approach is vital to guaranteeing the inclusion of vulnerable communities at the forefront of the climate crisis. This approach also helps to address equity and justice concerns while increasing the effectiveness of projects.

But what does climate change vulnerability and readiness in East Africa look like?

Climate vulnerability and readiness 

Did you know that Uganda is the most climate-vulnerable country in East Africa? While the level of exposure to climate impacts in East Africa is high, the readiness to tackle them in Kenya, Uganda and Tanzania is also low.

The three countries rank in the top 50 most vulnerable and least prepared to address the effects of climate change, with Uganda in the top 15 most vulnerable countries in the world and the 30th least prepared to deal with impacts.

Ranked out of 150 countries globally