It is no coincidence that the last report to the Club of Rome, Earth4All, deals with the 🔗poverty turnaround as the first of the five required turnarounds. Global poverty is certainly the most urgent global problem at present. Combating it is not only a prerequisite for individual well-being and peaceful coexistence, but also for a successful climate policy strategy.

by Hannes Swoboda (20.03.2024)

However, the report to the Club of Rome also makes it clear: “the economy of the poorest can grow.” This is also a rejection of all those who generally advocate an end to growth. But of course the authors are calling for a “different” growth model, namely one that is fair and environmentally friendly.

We will talk about this at the next 🔗Earth4All project event on April 2, 2024.

The ROLE OF AUSTRIA

Austria in particular, with its social market economy model and many ecological approaches, can be a welcome partner here. The principles and objectives of development policy, which focus on poverty reduction and climate policy, are also a step in the right direction.

Nevertheless, increased engagement in the poor countries of the South, particularly in Africa, could be of mutual benefit. Austria’s strong commitment in its European neighborhood should not stand in the way of this.

Economic growth in poor regions that learns the lessons of past industrialization is crucial for a successful climate policy. Industrialization and at the same time rejecting the fossil fuel economy is an important prerequisite for this.

What Hannah Ritchie states in her book “Not the End of the World” applies particularly to the poorer countries: “We have the chance to be the first generation to leave the environment in a better state than we found it. We could be the first generation to achieve sustainability.”

However, this cannot be achieved single-handedly; it requires global cooperation on a new basis. Above all, this requires a changed global financial system, altered trade relations and an accelerated exchange of technology. And the richer countries must be prepared to do this.

There are many reasons why this is necessary. The fact alone that the United States accounts for 20.3% and the countries of the European Union for 14.5% of the millions of cumulative CO2 emissions between 1850 and 2021, while Europe and North America together account for only 14% of the world’s population in 2021, shows the extreme imbalances. And these need to be corrected, at least now.

Incidentally, Europe’s share will fall from 9% to 7% and North America’s from 5% to 4% by 2050. And that should make us somewhat modest and at the same time ready to provide more support for the poorer part of the world – if only for our own sake. Moreover, there is a long history of colonization in which the West, and Europe in particular, has shouldered a lot of the blame. More support for the countries of the Global South can also be seen as part of reparations, although the focus should be on shaping our common future.

The case of Africa

If we look at poverty levels globally, one continent in particular stands out: Africa. It is the fastest growing continent in terms of population and, in this sense, the youngest. At the same time, Africa is the continent with the greatest challenges. This is where we find the greatest poverty, the most precarious living conditions, the greatest problems with access to water and education and also a very pronounced digital poverty among the broad sections of the population.

Unfortunately, this continent is also characterized by many armed conflicts and repeated military upheavals. Russia in particular plays an unpleasant role here by supporting such upheavals against democratic governments or keeping existing authoritarian governments alive with brutal mercenary troops.

Africa also has a wide range of resources, but can only use some of them. On the one hand, there are various raw materials that characterize both the fossil age and those that are necessary for the energy transition, especially in Europe. In both cases, Africa is dependent on exploitation by international corporations from Europe, the USA and, increasingly, from China, Brazil, etc.

Nevertheless, in a foreword to the report “Just Transition- A Climate Energy and Development Report for Africa”, the President of Kenya William S. Ruto wrote:

„ Africa is bursting with possibilities and a vast endowment of natural resources. The continent’s renewable energy potential is 50 times greater than the anticipated global electricity demand for the year 2040. The continent also has 40% of the global reserves of key minerals for batteries and hydrogen technologies. Africa, also has the largest tracts off arable land, and the continent is young, with 70% of the people under 30 years of age. It is time to tap these riches to achieve the aspirations of the people. “

Nevertheless, the discovery of fossil fuels still plays a major role in considerations of using existing resources to combat poverty and economic backwardness.

Some countries that have discovered large oil and gas deposits cannot understand when they are admonished by European countries to leave them in the ground. Especially when they are admonished by the same countries that have been using fossil fuels for a long time and from which they can expect little support for economic and environmental development.

As mentioned, one resource that is particularly available in Africa is the sun. Africa has 60 percent of the global solar resource but only 1 percent of the capacity to generate solar energy. And this particular energy poverty not only has consequences for the general standard of living, but also catastrophic effects on the expansion of economic potential. The expansion of this sustainable energy should therefore be the focus of intercontinental cooperation.

Insufficient help from the rich

In any case, we who live in the prosperous industrial North are called upon to make greater efforts to help the poorer countries and, in particular, our neighboring continent in the South. We should do this more directly as Austria, but also within the framework of the European Union. Unfortunately, despite some improvements, we are failing to do so.

And recently we have noticed a very short-sighted policy, with European aid to Ukraine partly coming at the expense of support for Africa. For example, the EU is also contributing to the fact that – without military aid – the same amount of development aid is spent on 1.5 billion in Africa worldwide as on 44 million in Ukraine. Instead, we should help both Ukraine and the poorer countries in the Global South and should not see this support as a zero-sum game.

Changes in the Global financial system

However, it is crucial to restructure the international financial system in order to generate more investment in Africa. UN Secretary-General Antonio Gueterres spoke of the need to change the current “morally bankrupt global financial system that perpetuates poverty and inequality”.

A redesigned financial system must help the African economy to diversify and become more competitive. At the same time, it is important to combat poverty and implement a progressive climate policy.

As already mentioned, the infrastructure must be expanded in order to establish a sustainable energy supply system. However, this expansion also serves to improve the transportation system in order to better serve both internal and international sales markets.

Agriculture also needs modernization and, above all, expanded and better irrigation systems. This is also increasingly about combating climate-related damage and preventing or mitigating crop failures.

The healthcare system also needs many improvements, as too many people are still dying too early. This also involves producing more vaccines and medicines in Africa itself.

The fundamental aim is to promote the independence of Africa – and other regions of the South. These countries should produce more of the necessary products and services, including in the area of research and development, in Africa itself. COMESA, the Common Market for Eastern and Southern Africa, which is currently being established, and a number of regional markets are important steps in this direction.

New capital and responsible government

All of this requires additional public and private investment. However, the capital required for this must be available at interest rates that do not lead to over-indebtedness from the outset. The so-called special drawing rights within the framework of the International Monetary Fund should also help to a greater extent.

As far as existing debt is concerned, fair debt relief is certainly necessary. For the future, however, the credit rating systems must also be designed in such a way that the long-term sustainability of debt for investments is at the forefront. Many African countries need to get out of the debt trap, but they need international support to do so.

This is particularly important in view of the fact that the proportion of private lenders has increased in recent years. And they are much more difficult to involve in debt relief procedures and agreements. In any case, it should be avoided that public lenders have to accept a debt haircut and at the same time private lenders rake in a high profit.


However, all of this also requires economically responsible behavior on the part of the various national governments in Africa itself. An international financial system – represented by the World Bank and the Monetary Fund – that focuses on combating poverty and climate change must come up against governments that support these very goals. And it also needs private investors to get involved. And there could certainly be more to come from Austria.

Fair trade and technological development

The “Earth for All” report also rightly points to the need for fair trade relations. Much has been done by the EU in this regard. Subsidies on agricultural exports have been reduced and markets have been increasingly opened up. However, international trade relations are still far from being fair and conducive to Africa’s development.

Moreover, some fear that laws such as the European Supply Chain Act will lead to a new closure of the European market through the back door. It is important to find regulations – as unbureaucratic as possible – that clearly serve climate protection and the social rights of the affected workers without thwarting the economic opportunities of exporting countries.

The purpose of European supply chain legislation is to contribute to socially and ecologically sustainable development. However, care must be taken to ensure that it does not lead to investors who do not have to comply with these rules – for example from China – taking advantage of them and replacing European investors and buyers.

But beyond traditional trade relations, there are many opportunities to expand cooperation for mutual benefit. For example, solar energy could be used to desalinate seawater and then produce hydrogen from it, as is being discussed in the case of Tunisia and Austria. Both desalinated water and hydrogen could then be used locally and jobs would be created. Many such cooperation projects could be mutually beneficial.

As mentioned, the “Earth4All” report also calls for improved technology transfer. Well, as I was able to see for myself on several trips to Kenya and Rwanda in particular, Africa is not a “technological desert”. There are certainly innovative developments, particularly with regard to digital payment systems using cell phones, decentralized energy supply using solar modules and decentralized drug distribution using drones. But there is a large field of technological cooperation that can be beneficial for both sides and that can still be expanded.

Migration as an opportunity

Global migration flows are primarily seen as a danger and threat in the richer countries, including Austria. They are politically instrumentalized. What is needed is a realistic and productive attitude that gives people in Europe/Austria the feeling that immigration is not “getting out of hand” and is taking place in moderation that benefits their own interests.

Migration from Africa to the European Union and specifically to Austria does not solve all the problems of strong population growth in Africa or the labor shortage in Europe. But it can help both sides – if it takes place in a controlled manner and leads to increased training of young Africans in EU countries. These young people can then help to alleviate the labor shortage in European countries but also bring new skills to Africa.

This can work above all if migration is also understood and designed as circular, meaning that some of the migrants return to Africa. This will work above all if Europe helps to drive economic, social and ecological development in Africa.

Tackled rationally and purposefully, migration can certainly help to strengthen the links between Africa and Europe. And such a strengthening is absolutely necessary for an effective climate policy.

In any case, we should not only see Africa as a conflict-ridden and helpless continent, but also as a continent full of opportunities. And these opportunities must also be used for global climate policy – above all by jointly combating poverty.