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The Ethiopian Climate Resilient Green Economy (CRGE) Strategy and the CRGE Facility

1. Introduction

These days, whenever we speak about development and economic growth the concept of green economy and sustainability have become a great concern. In the Growth and Transformation Plan (GTP) the issue of sustainable development has been given much emphasis. Out of the four main GTP objectives the two of them focused on sustainability.

These are:-

  • Establishing suitable conditions for sustainable nation building through the creation of a stable democratic and developmental state
  • Ensuring the sustainability of growth by realizing a stable macroeconomic framework.

Moreover, the seven strategic pillars of the GTP deal about sustaining rapid and broad based economic growth giving detailed attention to equitable growth, agricultural and industrial transformation, quality of social and infrastructure development, building capacity and good governance. Based on this background, the Government of the Federal Democratic Republic of Ethiopia launched the Ethiopia’s Climate Resilient Green Economy (CRGE) Facility in August 2012 to insure sustainable and environmentally friendly economic growth. Ethiopia which aspires to reach a middle income country by 2025 and sets a goal of double digit economic growth needs a green economy strategy that helps in multidimensional aspects to the country which is highly vulnerable to climate change. The CRGE initiative has triple goals of economic growth, net-zero emission and building resilience. The CRGE facility governance structure which has ministerial steering, technical and management committee predominantly embraced Ministry of Finance and Economic Development (MoFED) and Ministry of Environment Protection and Forestry as active participants and implementers.

2.Greening Ethiopia’s Economy

Ethiopia is one of the fastest-growing economies in Africa and in the world. It aspires to achieve middle-income status by 2025, without increasing its net greenhouse gas emissions and while protecting itself against the negative impacts of climate change. Ethiopia recognizes the link between environmental concerns and economic development. The country has historically been prone to extreme whether events. High rainfall variability causes droughts and floods on an almost annual basis, with severe consequences for the country's economy and people. The social and economic costs arising from climate variation and climate extremes are significant, and expected to become even more severe under climate change. If no adaptation measures are taken, climate change may reduce Ethiopia's GDP by as much as 2.5% per year by 2050. The government of Ethiopia therefore recognizes the importance of designing development policies with a view to climate and climate change. For Ethiopia, green growth is a necessity as well as an opportunity to be seized. It is an opportunity to realize our country’s huge potential in renewable energy and a necessity so as to arrest agro-ecological degradation that threatens to trap millions of our citizens in poverty.

3.The Ethiopian CRGE Initiative

Recognising the close links between environmental and development concerns, Ethiopia is working to integrate climate considerations into its broader development planning processes. The Ethiopian Climate Resilient Green Economy (CRGE) initiative, which was launched in late 2011, laid the foundation for integrated planning for climate-resilient development. Ethiopia’s CRGE initiative aims to "climate-proof" its National Development Plan goals so as to stabilise its net greenhouse gas emission while building resilience to against current climate risks and future climate change. Over time, Ethiopia aims to go beyond climate-proofing, to fully align its green growth and climate resilience objectives with its future national development plans. The CRGE initiative led to establishment of new institutions, new efforts in capacity building and financial resource mobilization, and triggered comprehensive climate risk and vulnerability analyses.

Ethiopia's decision to develop a strategic, national-level response to climate change has been triggered by a strong awareness about climate risks and strong political leadership. The historically high exposure to climate variability has created strong awareness about current and future climate impacts in Ethiopia. In its national development plan, the Ethiopian government explicitly identified climate variability and climate change as a threat to its development goals, and hence called for plan of action, strategies, laws, standards and guidelines, etc. to lessen the effect of forecasted climate change.

The CRGE process builds on Ethiopia's five-year national development plan, with a view to ensuring that Ethiopia's development targets are achieved in a low-carbon and climate resilient manner. The CRGE's three key objectives are to:

       i)foster growth and economic development;

       ii)manage greenhouse gas emissions; and

       iii)improve resilience to climate change.

This marks a significant shift in Ethiopia's climate change policy, lifting both climate change mitigation and adaptation from the environmental to a cross-governmental sphere. To fully mainstream climate resilience and green growth into development planning, Ethiopia aims to feed the CRGE into its next national development plan, which will cover the period 2015‑2020.

The CRGE consists of four elements which, once finalized, are intended to build a comprehensive national framework for Ethiopia’s climate change mitigation and adaptation policy. These elements include:

 A.The development of a national vision, laying out the key objectives and long-term development goals;

B.The development of a national strategy, outlining concrete steps for both climate change adaptation and mitigation;

C.The establishment of an institutional climate change system to facilitate cross-governmental co-operation and planning linkages; and

D.The establishment of financial and capacity-building mechanisms to support the implementation of the national CRGE strategy.

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