Analyses & Studies
Article | Economic Letter: East Africa and the Indian Ocean - March 2026
We are pleased to share insights from the French Treasury, offering economic analysis and sector-focused reports.
10 Years of the Paris Agreement: climate policy and action across the IOEA
The French Treasury (Direction générale du Trésor), under the French Ministry of Economy and Finance, publishes Economic Letters through its regional services to provide in-depth analysis of key economic sectors and trade dynamics in partner countries.
This edition takes stock of climate policy across East Africa and the Indian Ocean (IOEA) ten years after the Paris Agreement, adopted by 196 parties at COP21 in December 2015 and in force since November 2016, with its core goal of holding global warming well below 2°C and pursuing efforts toward 1.5°C. A decade on, the region has shown genuine climate ambition — led by regional frontrunners and reflected in strengthened Nationally Determined Contributions (NDCs) and consolidated national policies — but remains confronted with three major challenges: structural vulnerability to climate change, insufficient financing, and the need to reconcile population growth and economic development with the ecological transition.
The IOEA is among the world's most climate-vulnerable regions: the 2023 ND-GAIN Index ranks most regional states beyond 120th globally, with only Mauritius (44th) and the Seychelles (78th) as exceptions, while Burundi, Madagascar, Sudan and Eritrea rank among the 15 most vulnerable and least-prepared countries worldwide. Climate impacts already carry a heavy economic cost — an estimated 3–5% of GDP lost annually in Kenya and 1–2% in Tanzania — alongside deadly flooding events, even as the region accounts for under 1% of global greenhouse gas emissions, against 3–4% for Africa as a whole.
Implementation of the Paris Agreement remains uneven: 8 of the region's 15 countries have formally submitted updated NDCs, with Kenya notably among the first African countries to do so, in April 2025, while others such as the Comoros and Uganda are at advanced stages of updating theirs. Kenya, Ethiopia and Rwanda lead regional multilateral engagement, illustrated by Ethiopia's hosting of the Africa Climate Summit 2 in September 2025 and its upcoming role as host of COP32 in 2027 — the first COP held in the IOEA region.
Financing needs remain a central constraint: NDC implementation costs exceed national GDP in some cases, such as Burundi and South Sudan, and despite COP29's pledge of USD 300bn per year by 2035 from developed countries, the gap between estimated needs and mobilised financing — from multilateral development banks, bilateral donors, UNFCCC funds (Green Climate Fund, Adaptation Fund) and emerging instruments such as green bonds and debt-for-nature swaps — remains significant.
Overall, the Letter highlights France's growing structural role in the region's climate transition through the AFD, the Treasury and the FFEM, active in energy, green mobility, climate finance, sustainable cities and biodiversity, alongside the region's rising profile as a host of major international climate events — including the France-Kenya co-organised Africa Forward Summit in Nairobi (May 2026) and the 11th Our Ocean Conference in Mombasa (June 2026).
