According to Bloomberg, the $9.3 billion climate agreement that wealthy nations established with South Africa to assist in transitioning to clean energy sources will proceed despite the US’s withdrawal, as other partners remain dedicated to the initiative, stated the UK’s climate envoy.
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The US had intended to provide approximately $1 billion in commercial loans for the Just Energy Transition Partnership, which was agreed upon during President Joe Biden’s administration. Similar agreements were also made with Indonesia and Vietnam. Partners in the South African agreement include France, Germany, the European Union, the UK, the Netherlands, and Denmark.
“It’s unfortunate that the US is stepping back,” said Rachel Kyte, the UK’s climate envoy, in an interview in Pretoria on Thursday. “The rest of the world will continue to move forward.”
With President Donald Trump taking office in February and having previously disagreed with South Africa on issues like land expropriation and foreign policies, it was anticipated that he would withdraw from the agreement due to his skepticism about climate change. A statement from the office of South African President Cyril Ramaphosa confirmed receipt of the notification regarding the US’s exit, but further details were not provided.
Kyte noted that she was unaware if the US had also exited the programs with Vietnam and Indonesia.
Coal currently fuels around 80% of South Africa’s electricity generation, making it the most carbon-intensive economy among the Group of 20 nations. The funding from the JET program depends on the country reducing its reliance on fossil fuels that contribute to climate change. France and Germany have taken lead roles in implementing the program, providing €1.5 billion ($1.6 billion) in concessional loans to date.
The JETP initiatives were initially celebrated as a significant breakthrough in 2021, as they theoretically addressed a pressing question: how to combine public and private funding to make it financially viable for large developing countries to transition away from coal for electricity production. South Africa’s deal was the first to be finalized.
However, the initiative has faced challenges in achieving many of its goals due to delays in financing, changes in political leadership in Indonesia and Vietnam, and the complexities involved in shutting down power plants that are still fully operational for many years.
