Senegal has agreed to an investment pact worth 2.5 billion euros ($2.74 billion) with a group of advanced economies in order to expand its renewable energy industry and quicken the country's shift to a low-carbon economy.
The agreement is a part of the Senegal Just Energy Transition Partnership (JETP), which includes France, Germany, the European Union, the United Kingdom, and Canada. It was revealed on Thursday at the Summit for a New Global Financial Pact in Paris.
Senegal's goal of having 40% of installed capacity come from renewable sources by 2030 would be helped by the funding, and a draft investment plan will be finalized in the next 12 months.
At the Summit for a New Global Financial Pact in Paris, Sall stated, "We think that if this is mobilized we can achieve, if not exceed this objective." He also noted that 31% of Senegal's capacity is already made up of renewable energy.
A contract with South Africa at a U.N. meeting in 2021 served as the impetus for the creation of so-called JETPs, which have since become a crucial tool for mobilizing public and private funding to support poor nations' transition away from fossil fuels.
Rich, high-emitting countries that pay these agreements are coming under greater pressure to aid developing nations in hastening the switch to cleaner energy sources and managing the impacts of climate change.
Senegal's pact is the fourth JETP, following agreements with South Africa, Vietnam, and Indonesia. The UN COP27 climate meeting, which was held in Egypt in November of last year, was where the JETP with Senegal was being discussed.
The largest to date was the $20 billion arrangement made last year to assist Indonesia in closing coal power facilities.
In a statement released on Thursday, it was said that during an initial period of three to five years, beginning this year, foreign partners and multilateral development banks will mobilize the 2.55 billion euros for Senegal in new and extra finance.
Additionally, more funding could be raised during and beyond this time frame to assist Senegal's goals. Sall lamented the high cost of lending and urged multilateral development banks to take into account contemporary challenges like climate change and the significant debts of low-income nations. "The current global financing system is not adequate," Sall added.