COP29: Financing just transition for Nigerian workers

In the ongoing 29th Conference of the parties to the United Nations Framework Convention on Climate Change in Baku, Azerbaijan, the Nigeria Labour Congress organised two side events, one at the Nigeria pavilion and the other at the International Labour Organisation pavilion.

The first was to discuss modalities for achieving “just transition through social partnership,” while the second reviewed “Nigerian workers’ position on nationally determined contributions.”.

Just transition could be described as ensuring that no one is left behind or pu

shed behind in the transition to low-carbon and environmentally sustainable economies and societies.
It was refreshing seeing our own NLC at the COP29, as one was filled with a sense of pride, hearing many international participants congratulate the organisation for putting together the side events. One of the delegate moderators said it was the first time they were hearing the specific mention of financing of the just transition in the NDCs at the COP. This can only mean that Nigerian workers are taking the lead in shaping a critical global agenda on the most relevant international platform possible.

The NLC’s position on the NDCs leaves its fundamental principles on a tripod. The first is that climate change is primarily a workplace issue, as most impacts of climate change are on the workplace; therefore, the workplace must play a principal role in all climate actions. The second is that Nigerian workers identify and recognise the need for a transition to green and clean fuel. The third emphasises the adoption of a gender-balanced societal approach involving the least vulnerable groups.

In the run up to COP29, the NLC, with the support of the ILO and the American Centre for International Labour Solidarity, in carrying out its research, had engaged Nigeria’s NDC to determine the gaps regarding workers’ positions, voices, and concerns.
The report was presented by research consultant Elijah Iklaga at the side event. He underlined key gaps in the inclusion of trade unions, in public policy spaces on climate change, and just transition manifested by disrespect of fundamental rights at work, poor consultation with workers through social dialogue, green skills acquisition, upgrading, scanty social protection cover for vulnerable workers marked by weak occupational safety, health safeguards, and sparse skills audit to establish skill deficits in Nigeria’s seven priority sectors: energy, power, industries, agriculture, forestry and other land use, transport, water, and waste.

Comrade Echezona Asuzu, NLC National Coordinator on Climate Change, Green Jobs, and Just Transition, said the report of the research on the NLC’s position on Nigeria’s Nationally Determined Contribution would be shared once the inputs from the two NLC side events at COP 29 are mainstreamed and adopted by the NLC leadership.

Many countries have made progress in integrating consideration of just transition into their NDCs, and this is why it is important the federal government takes the NLC seriously in this regard. We must design and promulgate our own home-made implementation plans, both at the local and national levels. Now that many of the country’s subnational governments are showing interest in fighting climate change at the individual level, they have to take their ambition to the next level by making provisions for just transition. We may not be able to know the extent to which this issue will affect the entire polity, but very soon the scenario will become clear to us all.
We can learn from South Africa, one of the countries involved in Just Energy Transition Partnerships, one of the first global initiatives for accelerating the commitment to phasing out coal, sharing insights into the challenges the country faces in transitioning to a renewable energy-based economy, so that we quickly learn how the transition can be continuously improved in order to address those challenges over time. Many countries in the developed world attest to the imperative and gains of redirecting available capital towards just and inclusive climate action. Nigeria is a microcosm of the developing world where misallocation of climate finance due to ineffective policies and a lack of political signals means that only a few stakeholders are currently benefiting from available climate finance.

In the same vein, it is important to examine some of the recommendations of the UNFCCC’s Standing Committee on Finance, released after its deliberations in 2023. It stated that national finance ministries could ensure that the social dimensions of climate action are taken into account in macroeconomic and fiscal policies. It also suggests that policy signals and dialogue with stakeholders, especially those most affected by the transitions, should serve as means to promote a holistic approach to integrating consideration of just transitions into national policy making and good governance practices. Likewise, transitions that consider local industry value chains aligned with NDC’s and national net zero goals must be cultivated and supported while seeking ways to attract global funding systems to entrench progress in this direction.

The question remains. How can just transitions be financed in Nigeria, and who should be held responsible? The answer is everyone must be involved. The government, private entities, international aid agencies, communities, and workers’ cooperatives. In a nation where everything is politicised, we may start by establishing just transition committees across the critical sectors of the economy.

In my view, the Nigerian government must view this with the same sense of urgency and consequence it deployed in the establishment of the pension management policy across the entire national economy. It touches on all the important aspects of the nation’s workforce. Occupational health and safety, skills development, training, social dialogue, social protection, recognition of labour rights, universal social protection, decent work, and safe working environments.
Additionally, I have maintained that green banking be mainstreamed in Nigeria. This is the time to go this pathway. It is recognised that funding the construction of renewable energy projects is arguably the most obvious and direct method for banks to help drive the low-carbon transition. But what about microfinance banking and cooperative banking, which are the mainstays of financial inclusion in a poor nation like ours? I am convinced that we cannot honestly discuss just transition without such people-friendly financial mechanisms and insurance policies.

Indeed, the role of the financial sector in the successful implementation of the just transition is therefore critical, as its ability to allocate capital to viable and impactful opportunities is central to the process. In this way, the organised labour can start its own green banks in order to provoke national action. There are a lot of low-hanging fruits. We have a lot of people in the rural areas involved in agriculture, which is most impacted according to research in transiting to a greener future.

The fact is most Nigerians are employed in the agricultural sector, which is marked by a very high level of informality and skills deficits, especially with regards to the demands of green decarbonised agriculture (climate smart agriculture), weak investment by the private sector, and poor input support from the government. Interestingly, the NLC is armed by scientific evidence.

Its own research report, which was presented to a global audience at the COP28 in Dubai, also discovered that 87.4 per cent of Nigerians lack the financial resources to make the transition to a green economy. In addition, many workers in Nigeria are unable to acquire green energy appliances and consumables, owing to poor wages and abysmal purchasing power, thus standing the risk of being left behind in the transition.

What is more, many Nigerian workers do not have adequate social protection mechanisms to shield them from the impact of the ongoing transition to a green economy, as 81.4 per cent of workers lack insurance against job loss.