South Africa Considers Dutch, Danish Inclusion in R160 Billion Climate Pact

South Africa's cabinet is deliberating a proposal aimed at including the Netherlands and Denmark in the existing R160 billion ($8.5 billion) climate-finance pact. Initially signed with the UK, US, France, Germany, and the European Union, this pact focuses on aiding South Africa to avert its heavy reliance on coal, which facilitates over 80% of the nation's power.

The Just Energy Transition Partnership, as it is known, has witnessed setbacks due to delays and opposition from local coal miners. However, the inclusion of the Netherlands and Denmark, proposed by the existing pact partners, could provide the much-needed boost and help expedite this monumental deal. Besides, this pact could serve as a standard for similar agreements with other developing nations also grappling with coal-dependency, like Indonesia and Vietnam.

While expressing non-disclosure, South African President Cyril Ramaphosa's spokesman Vincent Magwenya stated that a decision on the proposal would be communicated soon after the cabinet's discussion. Both the Netherlands and Denmark have done their fair share in supporting South Africa's transition from fossil fuels, and this move could further cement their contribution.

Despite the outlined benefits, the climate pact poses political risks to President Ramaphosa. The coal-mining industry, which employs about 90,000 individuals, coupled with its associated industries, have been significant contributors to the South African economy. Any move towards green energy affects not only these workers but also impacts broader industries like trucking that thrived during apartheid.

South Africa plans to showcase a comprehensive implementation plan for the agreement at the upcoming COP28 meeting in Dubai on the 30th of November, given the unions' complaints are adequately addressed.