By: Justice Akoto, Sustainable Operations Advisor- Fidelity Bank
Ghana’s Nationally Determined Contribution (NDC) is more than just a climate pledge – it’s a balance sheet reality. The country has committed to reducing emissions by 15% unconditionally and 45% conditionally by 2030, targeting key sectors like forestry, energy, waste, agriculture, transport, and industry. These sectors intersect daily with banking and business decisions, making climate action a critical component of financial planning.
Forestry is a critical area, with forest loss driving emissions and impacting cocoa productivity. The sector is a significant contributor to Ghana’s economy, and its degradation has far-reaching consequences. Energy is another key sector, with thermal power and inefficient industrial energy use inflating costs and carbon exposure. Ghana’s reliance on diesel power also poses significant risks to the environment and the economy.
Waste and sanitation are also crucial, contributing to methane emissions and urban health issues. The sector is often overlooked, but it’s a critical component of Ghana’s climate commitments. Agriculture ties it all together, with climate shocks directly affecting farmer incomes, loan performance, and food inflation.
The NDC is underfunded, and grants are shrinking. However, carbon markets can unlock private capital and finance climate-smart investments. Ghana’s banking sector needs to prioritize carbon markets to manage climate risk and capitalize on emerging opportunities.
For Ghana’s banking sector, carbon markets are not abstract – they influence project bankability, collateral value, and transition risk. A structured domestic carbon market, aligned with Article 6, robust MRV, and clear host-country approvals, turns climate action into measurable financial opportunity, not compliance burden.
Fidelity Bank Ghana is supporting clients to align investments with Ghana’s NDC, manage climate risk, and unlock climate finance. The transition to sustainability is happening, and carbon markets are a key part of it. As Ghana moves towards a low-carbon economy, financial institutions and businesses must prioritize sustainability to remain competitive and mitigate climate-related risks.
Source: www.climatewatchonline.com
