Tanzanian businesses urged to embrace sustainable practices for emission reduction goals

Dar es Salaam. Companies in Tanzania must prioritise sustainable social and economic development in their business operations if they want to fully support the government’s commitment to reduce emissions by 30–35 percent by 2030.

This was the main agenda in the discussions on sustainable finance with a particular focus on climate finance and investments in adaptation strategies on Friday, February 16, 2024, among industry experts and thought leaders.

The Sustainable Finance Forum, a first in the Tanzania banking industry, was hosted by Standard Chartered Bank, bringing together government officials and industry practitioners from both the public and private sectors.

Despite its small contribution to global emissions, Tanzania has committed to a robust climate mitigation goal.

In its updated Nationally Determined Contribution (NDC) submitted to the United Nations Framework Convention on Climate Change (UNFCCC) in 2021, Tanzania has set a GHG emission reduction target of 30-35 percent below its business-as-usual (BAU) emission level by 2030.

According to Standard Chartered, like in Tanzania, the world aims to reach net zero carbon emissions by 2050 to limit the worst effects of climate change.

“This will require efforts from across stakeholder groups to accelerate the transition to a low-carbon, nature-positive, and climate-resilient economy,” said the bank’s Chief Executive Officer (CEO), Mr Herman Kasekende, at the forum.

As such, the bank said it was catalysing sustainable finance and partnerships, aiming to provide $300 billion in sustainable finance by 2030. This, according to the Commissioner of External Finance at the Ministry of Finance, Mr Rished Bade, is an opportunity for the local entities to access finance to support them in running sustainable operations.

Commending Standard Chartered for leading the way in offering sustainable finance to support entities, Mr Bade called upon other financial institutions to play their roles in fighting climate change and highlighted the concerted efforts the government was making.

“The government has set guidelines instrumental in integrating climate change adaptation issues into respective sectoral policies, plans, and programmes; however, we are aware that fighting against climate change requires collaborative efforts from both the private and public sectors,” he said.

Stressing that the world must reach net zero carbon emissions by 2050 to limit the worst effects of climate change, the bank’s CEO said the bank was committed to supporting sustainable social and economic development through its business, operations, and community.

“The goal will require efforts from across stakeholder groups to accelerate the transition to a low-carbon, nature-positive, and climate-resilient economy,” he said.

According to the Chief Sustainable Officer for Standard Chartered, Ms Marisa Drew, the bank has the financial expertise, governance frameworks, innovative thinking, technology, and geographical reach to connect markets and activities to capital, where it is most needed.

“We target companies and industries that are striving to mitigate and adapt to climate resilience measures; we support their projects financially for sustainable growth because we are committed to accelerating the net zero transition by reducing our emissions, with targets for carbon-intensive sectors.”

Director General of Tanzania Railway Corporation (TRC), Mr Masanja Kadogosa highlighted how financial institutions can play a significant role in climate mitigation and adaptation, giving an example of the milestone that the Standard Gauge Railway (SGR) project has attained in terms of environmental protection through Standard Chartered Bank sustainable financing.

“Standard Chartered is not just a bank to us; they are also our friends, they are our partners, and in 2020 they came in and funded our SGR project with $1.6 billion,” he said.

“The bank has a lot of projects that it can support, but it decided to choose the SGR, a project that has gained reputation for its climate mitigation and adaptation strategies not only in Tanzania and Africa but also globally due to various initiatives we have taken, including the design that considers the environment,” he said.