Working PaperEnergyRegion & Country Studies

Fossil Fuel Subsidy Reform in sub-Saharan Africa: From Rhetoric to Reality

Shelagh Whitley, Laurie van der Burg

The costs of fossil fuel subsidies far outweigh the benefits when considering the full economic, social, and environmental impact of these subsidies in sub-Saharan Africa. However, efforts to dismantle fossil fuel subsidies in sub-Saharan Africa are hampered by a lack of transparency, reliance on fossil fuels to support national development strategies, special interest agendas, and weak institutional capacity to communicate and support reform.

Authors

Shelagh Whitley Overseas Development Institute

Laurie van der Burg Overseas Development Institute

Overview

Nov 2015

The costs of fossil fuel subsidies far outweigh the benefits when considering the full economic, social, and environmental impact of these subsidies in sub-Saharan Africa. However, efforts to dismantle fossil fuel subsidies in sub-Saharan Africa are hampered by a lack of transparency, reliance on fossil fuels to support national development strategies, special interest agendas, and weak institutional capacity to communicate and support reform.

If done right, phasing out fossil fuel subsidies in sub-Saharan Africa will lower greenhouse gas emissions, reduce air pollution, and create the fiscal space to provide access to energy and meet social development objectives. Governments must take a holistic approach to fossil fuel subsidy reform, accompanying the policies with research, communication, and implementation initiatives, along with complimentary social support measures.

Associated graphics

Fossil fuel subsidies and climate finance in developing countries

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Aid received compared to fossil fuel subsidies

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Fossil fuel subsidies as a percentage of GDP by region

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