Introduction – A Tale of Two Storms

For the residents of Accra, climate change is not a distant forecast but a tale of two storms: the violent deluges that turn streets into rivers and the silent, searing heat that oppresses daily life[1]. The first storm is one of torrential rain. On June 3, 2015, Accra was paralyzed by a landmark flood that submerged entire neighbourhoods, turning roads into impassable waterways and contaminating water sources with diseases like cholera and typhoid[2]. The disaster culminated in a horrific explosion at a flooded gas station, a tragic event that contributed to the deaths of over 150 people[3]. In total, the 2015 flood affected 53,000 people, destroyed thousands of buildings, and caused an estimated US $55 million in damages, with reconstruction costs soaring to US$105 million[4]. This was not an isolated incident; flooding has become a perennial problem in a city where more than half of all flooding events in Ghana occur[5].

The second storm is quieter but no less menacing. It is the steady, creeping rise in temperature, which has already increased by over 1 degree Celsius since 1960[6]. This slow-moving disaster manifests as oppressive heat stress that affects crop yields, reduces labor productivity, and intensifies the risk of water-borne diseases[7]. For the millions living and working in Ghana’s capital, this means more precarious livelihoods and heightened health risks[8].

These twin storms do not strike indiscriminately. Their devastating impacts are disproportionately borne by the city’s most vulnerable communities[9]. An estimated 90% of those at risk from flooding in Accra reside in informal settlements, often located in low-lying areas with inadequate drainage and substandard housing[10]. In the aftermath of the 2015 floods, it was the poorest households that lost a significantly higher share of their assets and income, taking far longer to recover[11]. For these residents, crowded into areas like the Odaw River Basin, the intersection of urban poverty and climate vulnerability is a daily, life-threatening reality[12]. This is the human story behind the statistics a story of lost homes, shattered livelihoods, and enduring psychological trauma, making the quest for climate resilience in Accra not just a policy challenge, but an urgent human imperative[13].

The Climate Finance Gap Explained

To build a resilient future, cities like Accra need massive investment. However, they face a staggering gap between the funds required and what is actually available.

What is Climate Finance?

Climate finance refers to funding from local, national, or international sources whether public, private, or alternative that is specifically aimed at addressing climate change[14]. Its goal is twofold:

1. Mitigation: To reduce or prevent greenhouse gas emissions through projects like renewable energy or sustainable transport[15].
2. Adaptation: To help communities adjust to the current and future impacts of climate change, for instance, by building flood defences or developing heat-resilient infrastructure[16].

For a country like Ghana, this finance is a critical tool for implementing its Nationally Determined Contributions (NDCs) under the Paris Agreement and achieving sustainable development goals[17].

The Staggering Scale of the Gap: Key Statistics

The disconnect between climate finance needs and reality is stark, especially for the African continent.

• Global Disparity: While trillions are needed for urban climate action worldwide, only about 10-20% of these investments come from international financial institutions, UN climate funds, or private investors[18].
• Africa’s Shortfall: The African continent requires an estimated USD 277 billion annually to meet its climate goals between 2020 and 2030. However, in 2019/2020, the total climate finance that flowed to Africa was just USD 29.5 billion per year a mere 11% of what is needed[19].
• Ghana’s National Challenge: Ghana alone needs between USD 15.5 billion and USD 22.6 billion to implement its climate action plan by 2030[20]. The country faces an annual financing gap of around US$670 million for adaptation and resilience. While US$6.4 billion is expected from domestic sources, the remaining US$16.2 billion must come from external support[21].

Why Cities Struggle to Access Climate Finance

Despite the clear need, cities and local governments face a formidable set of barriers that prevent them from securing the funds necessary to protect their citizens.

1. Institutional and Governance Hurdles
   Cities often operate within complex and fragmented systems that hinder their ability to attract and manage funds.

• Fragmented Agendas: Responsibilities for climate action are often scattered across various government departments, leading to a lack of coordination and a clear, unified strategy that funders look for[22].
• Regulatory Bottlenecks: Inefficient procedures, administrative hurdles, and ambiguous legal frameworks for public-private partnerships undermine the effectiveness of climate finance instruments. This is a key reason why accessing international climate funds is so difficult[23].
• Jurisdictional Confusion: Decentralization efforts can create confusion over which level of government is responsible for certain projects, complicating financial mobilization and planning[24].

2. Capacity and Resource Constraints
   Local governments frequently lack the specialized skills and resources required to compete for global funds.

• Limited Technical Expertise: Many cities lack the in-house capacity to develop “bankable” project proposals that meet the rigorous standards of international funders[25]. This includes conducting detailed climate risk assessments and gathering the necessary data to justify investment[26].
• Budget and Staff Shortages: Constrained budgets and limited staff prevent cities from dedicating the necessary resources to plan ambitious projects and navigate complex application processes[27].
• Low Budget Execution: Even when funds are allocated for climate initiatives, they are often not fully spent. In Ghana, central government agencies spent only 27% of their climate-earmarked budgets between 2015-2020, while local assemblies spent just 35%[28]. Unpredictable and delayed fund transfers from the national level further constrain local action[29].

3. Financial and Economic Barriers
   Broader economic challenges severely restrict a city’s ability to invest in climate resilience.

• High Public Debt: In countries like Ghana, where public debt has exceeded 90% of GDP, the government has very limited fiscal space to co-finance climate projects or invest in adaptation[30].
• Underdeveloped Financial Markets: Local markets for instruments like green bonds, which could unlock private investment, are often small and underdeveloped, making it difficult to raise capital at scale[31].
• Lack of Private Sector Cooperation: Mobilizing private investment is crucial but remains a challenge due to perceived risks, currency instability, and the need for a more supportive investment climate[32].

4. Data and Information Gaps
   A lack of reliable data makes it difficult for both cities and potential investors to make informed decisions.

• Poor Tracking: Climate-related spending is often not properly tracked or disaggregated at the city or local level, making it hard to identify funding gaps and opportunities[33].
• Scarcity of Investment-Grade Data: Investors are often deterred by a lack of standardized, accessible data on climate impacts and project viability, which they need to assess risks and potential returns[34].

Accra as a Case Study: Ambition Confronts Reality

Accra, Ghana’s rapidly growing capital, is a city on the front lines of the climate crisis, caught between severe environmental threats and bold, forward-thinking plans. The city’s experience offers a powerful illustration of how local climate ambition can be stalled by a system that keeps crucial funding out of reach.

The Compound Risks: Floods, Heat, and Pollution

Accra faces a trio of interconnected climate hazards that threaten its infrastructure, economy, and the well-being of its residents.

• Perennial Flooding: The city’s most visible and destructive climate risk is flooding. Situated on the coast and in a river basin, Accra is highly susceptible to extreme rainfall events that have become more frequent and intense. The landmark flood of June 3, 2015, resulted in over 150 deaths and caused damages estimated at US$55 million. These floods disproportionately impact the most vulnerable, with over 90% of at-risk communities living in informal settlements where poor drainage and substandard housing amplify the devastation.
• Intensifying Heat: Accra is getting hotter. The average temperature has already risen by more than 1°C since 1960, and the urban heat island effect makes the city significantly warmer than surrounding areas by as much as 4.86°C. This extreme heat strains energy grids, reduces labor productivity, and increases the risk of heat-related illnesses, especially for those working outdoors or living in poorly ventilated housing.
• Worsening Air and Water Quality: Climate impacts are compounded by environmental pollution. Congestion from traffic and poor waste management contribute to ambient air pollution, which carries an estimated annual cost of US$1.1 billion in Ghana. Furthermore, flooding events overwhelm inadequate sanitation systems, contaminating water sources and increasing the risk of diseases like cholera and typhoid.

The Vision: Accra’s Climate Action Plan

In response to these threats, Accra has positioned itself as a leader in urban climate action. Partnering with the C40 Cities network, the Accra Metropolitan Assembly (AMA) developed a comprehensive Climate Action Plan (CAP) in 2020. The plan sets ambitious goals aligned with the Paris Agreement:

• To become an emissions-neutral and climate-resilient city by 2050.
• To reduce emissions by 27% by 2030 and 73% by 2050.
• To achieve these targets through concrete actions, such as shifting 60% of passengers to mass transit, treating 100% of wastewater, and capturing 90% of landfill gas.

This plan demonstrates a clear vision for a sustainable future. However, the city’s ability to turn this vision into reality is severely constrained by a critical lack of funding.

The Reality: A Trickle of Funds for a Torrent of Problems

Despite its leadership and detailed planning, the AMA struggles to finance its climate agenda. An analysis of the city’s development plan revealed that only about 20% of the CAP’s proposed actions were reflected in the budget as of 2022, highlighting a massive gap between planning and implementation.

The core of the problem lies in how climate finance is channelled. The vast majority of funding is controlled and executed at the national level, leaving local authorities with insufficient resources to act.

A 2021 review of climate spending from 2015–2020 found that while national ministries and agencies (MDAs) had earmarked GHS 7.5 billion (US$1.7 billion) for climate activities, the local governments (MMDAs) where adaptation work is most critical received only GHS 405 million (US$93.7 million) in earmarked funds.

This structure means that only a sliver of climate finance trickles down to the local level. The AMA and other MMDAs operate with limited budgets, unpredictable fund transfers from the central government, and a reduced capacity to raise their own revenue, without direct and reliable access to climate finance, Accra’s ambitious Climate Action Plan remains largely aspirational, leaving its most vulnerable citizens exposed to the escalating storms of climate change.

Why Cities Need Direct Support: Putting the Hose in the Hands of the Firefighters

The current system for funding climate action is fundamentally disconnected from the reality on the ground. Imagine a neighbourhood is on fire. The flames are spreading rapidly, threatening homes and lives. The local firefighters are on the scene, equipped with the knowledge of every street, hydrant, and vulnerable resident. But the water hoses the one tool they need to fight the blaze is controlled by a committee in a distant office, which must first approve the request, allocate the resources, and then send them down a long, inefficient pipeline.

This isn’t just an analogy; it’s the daily reality for cities like Accra. Local governments are the first responders to the climate crisis, yet they are systematically denied direct access to the funds required to act effectively.

The numbers reveal the startling scale of this disconnect. A review of Ghana’s climate-related budgets between 2015 and 2020 showed that while national ministries and agencies earmarked GHS 7.5 billion (US$1.7 billion) for climate activities, a mere GHS 405 million (US$93.7 million) was allocated to the Metropolitan, Municipal, and District Assemblies (MMDAs) the very institutions responsible for implementation. This means only about 5% of earmarked public climate funds were designated for the local level where the “fires” of climate impact are actually burning. This top-down model, where funds are channeled through national governments, creates bottlenecks, delays, and ensures that resources rarely reach the communities that need them most.

Empowering cities with direct funding is not just about efficiency; it is about effectiveness. Local leaders and communities possess the granular, on-the-ground knowledge needed to design projects that work, avoiding the kind of maladaptation that can occur when plans are imposed from afar.

More Than Just Resilience: The Co-Benefits of Investing in Cities

Furthermore, channelling climate finance directly to cities is one of the highest-return investments a nation can make. The benefits ripple far beyond disaster prevention, creating a virtuous cycle of development, prosperity, and well-being.

Investing in urban climate action yields significant co-benefits:

• Economic Growth and Job Creation: Building resilient infrastructure, retrofitting buildings, and expanding sustainable transport are labour-intensive projects that create local green jobs and stimulate economic growth.
• Improved Public Health: Projects like creating green spaces reduce the urban heat island effect, while investing in better waste and wastewater management prevents the spread of diseases like cholera and typhoid that spike after floods. Curbing traffic pollution also generates significant health savings.
• Enhanced Social Equity: When locally-led, climate projects can be designed to explicitly protect the most vulnerable residents in informal settlements, ensuring that adaptation efforts reduce inequality rather than reinforcing it. This process builds trust and collaboration between the government and marginalized communities.
• Safer, More Liveable Communities: Ultimately, these investments create cities that are not just safer but more pleasant and productive places to live, with improved pedestrian safety, cleaner air, and better access to essential services.

Cities are not just victims of climate change; they are indispensable engines of the solution. Providing them with direct, predictable, and adequate financial support is the fastest and most effective way to build a resilient, equitable, and sustainable future for all.

The Pan-African Perspective: A Continent of Cities in the Same Position

Accra’s struggle is not an isolated case but a microcosm of a systemic challenge facing urban centers across Africa. From Lagos to Nairobi, rapidly growing cities are on the front lines of climate change, yet they are hamstrung by nearly identical gaps in finance and capacity. This issue is pervasive across the continent, where the ambition to build resilient, sustainable cities collides with a financial architecture that keeps resources out of reach.

The core of the problem is a structural disconnect. A significant portion of international climate funds is channelled through national governments, with only a small fraction ever reaching the local authorities responsible for on-the-ground implementation. This creates a critical bottleneck, as municipal and district assemblies often lack the budgets, staff, and technical capacity to develop the “bankable” project proposals required to attract international investment. The result is a continent-wide paradox: while Africa’s urban areas are engines of economic growth, their vulnerability to climate impacts like flooding, heatwaves, and water scarcity is escalating faster than their ability to adapt.

Hopeful Pathways: Nairobi’s Model of Community-Led Finance

While the challenge is immense, innovative models are emerging that offer a blueprint for how cities can overcome these barriers. A powerful example comes from Nairobi, Kenya, which has demonstrated success by empowering its most vulnerable communities to become active partners in their own climate adaptation.

Faced with the challenge of improving conditions in its vast informal settlements, Nairobi’s government forged a groundbreaking partnership with universities, civil society organizations (CSOs) like Slum Dwellers International, and a specialized financing entity called the Akiba Mashinani Trust (AMT).

Instead of a top-down approach, this model works from the ground up:

• The AMT helps residents in informal settlements organize into savings groups, building financial discipline and social cohesion.
• It then leverages the track record of these savings groups to negotiate with banks for larger, collective development loans that would be inaccessible to individuals.
• This community-centered financing empowers residents to co-design, fund, and own critical infrastructure upgrades, from improved drainage to sanitation facilities.

By leveraging community financing capacity, Nairobi has turned informal settlements from passive recipients of aid into active partners in urban development. This approach not only mobilizes new streams of funding but also builds local capacity, reduces governance costs, and ensures that projects meet the real needs of the community.

This collaborative, community-driven financing in Nairobi, along with national initiatives like Kenya’s Financing Locally-Led Climate Action (FLLoCA) program designed to build climate finance capacity at the county level offers a hopeful and replicable pathway for other African cities to finally access the resources they desperately need to build a resilient future.

Conclusion: A Call to Action for Urban Climate Survival

The disconnect between the escalating climate risks facing African cities and the financial resources available to them is not just a gap; it is a chasm that threatens millions of lives and the continent’s economic future. The current model where cities stand on the front lines of the climate crisis while the life-saving funds are stalled in national pipelines, is untenable.

Closing this chasm is an urgent imperative that demands a two-pronged revolution. It requires a fundamental shift in the global financial architecture, re-routing the pipelines of support to flow directly to the urban centres where action is most needed. Simultaneously, it calls for bold, proactive leadership from the ground up, as mayors and local officials innovate, forge new partnerships, and build the institutional muscle needed to absorb and deploy these funds effectively.

This is not a theoretical exercise; it is a practical mission already underway. The upcoming C40 Climate Finance and Political Masterclass represents a timely and vital initiative in this fight. By equipping city leaders from across the Global South with the very tools needed to change this narrative from navigating complex funding mechanisms to structuring bankable projects and forging public-private partnerships, it aims to turn local ambition into funded action.

The time for talk has passed. The moment has come to empower our cities, not as supplicants for aid, but as capable, funded, and indispensable architects of a resilient and sustainable world.