Part 10 — SDG 13, Energy Transition, Resilience and Low-Carbon Industry

Climate change is no longer a distant environmental risk. It has become an immediate economic and development constraint for African economies. Rising temperatures, extreme weather events, coastal erosion and energy insecurity are already disrupting production systems, infrastructure and livelihoods.

Sustainable Development Goal 13 (SDG 13) calls for urgent action to combat climate change and its impacts. For countries pursuing industrialisation through Special Economic Zones (SEZs), the central question is no longer whether climate action should be integrated, but how rapidly and deliberately it can be embedded.

SEZs provide a strategic entry point. By concentrating investment, infrastructure and regulatory authority within defined geographic spaces, they can serve as controlled testbeds for energy transition, climate-resilient infrastructure and low-carbon industrial models. Properly designed, SEZs allow African economies to reconcile industrial growth with climate commitments, while remaining competitive in an increasingly carbon-constrained global economy.

This analysis builds directly on Part 9 (SDG 12), which examined cleaner production and circular economy practices, as well as earlier discussions on SDG 9 (Industry and Infrastructure) and SDG 11 (Sustainable Cities). SDG 13 provides the unifying imperative: industrialisation that ignores climate risk is no longer sustainable industrialisation.

Why SDG 13 matters for SEZs and investment competitiveness

Global investment dynamics are shifting decisively. Successive World Investment Reports have shown that energy-transition and climate-related investments are among the fastest-growing segments of global foreign direct investment, even as overall flows remain volatile. Investors are increasingly screening destinations based on three core criteria: access to clean and reliable energy, resilience of infrastructure to climate risks, and alignment with environmental, social and governance standards.

SEZs that fail to respond to these expectations risk rapid obsolescence. By contrast, zones that position themselves as low-carbon and climate-resilient investment platforms are more likely to attract higher-quality, long-term and technology-intensive investment.

SEZs as testbeds for the renewable energy transition

Energy remains one of the most binding constraints on industrial competitiveness in Africa, characterised by high costs, unreliable supply and carbon-intensive generation. SEZs offer a practical platform to pilot solutions at scale.

Utility-scale renewables for zone power. By aggregating demand within a defined area, SEZ authorities can anchor utility-scale solar, wind or hybrid renewable projects dedicated to zone operations. This lowers energy costs, improves reliability and reduces emissions. The World Investment Report 2023 explicitly recommends leveraging SEZs to catalyse energy-transition investments, particularly in economies where grid constraints persist. In countries with strong solar and wind resources, renewable-powered SEZs also reduce exposure to fossil-fuel price volatility, an increasingly significant macroeconomic risk.

Distributed generation and energy efficiency. Beyond large projects, SEZs can mandate rooftop solar, energy-efficient building standards and smart energy management systems. Because infrastructure rules within zones are centrally regulated, efficiency can be embedded by design rather than left to individual firms. This directly links SDG 13 with SDG 12’s focus on resource efficiency and SDG 9’s emphasis on modern infrastructure.

Low-carbon industrialisation and green incentives

Climate action within SEZs must extend beyond power supply to industrial processes and incentive frameworks. Traditional SEZ incentives, often focused narrowly on tax exemptions, can be recalibrated to support low-carbon outcomes.

Governments and SEZ authorities can prioritise investors deploying low-emission technologies, fast-track approvals for green projects and link selected benefits to measurable emissions reductions or energy-efficiency improvements. The World Investment Report underscores the need for investment promotion agencies and SEZ authorities to actively target climate-aligned investments, rather than passively licensing firms. For African SEZs competing for scarce green capital, this shift is increasingly decisive.

SEZs as hubs for climate-related industries

Beyond greening existing production, SEZs can host industries central to the energy transition itself. These include renewable-energy equipment manufacturing, electric mobility components, green construction materials and recycling technologies. By clustering such firms, SEZs accelerate technology diffusion, reduce production costs and strengthen domestic value chains aligned with future global demand.

Climate-resilient infrastructure: protecting investment and communities

SDG 13 is as much about adaptation as mitigation. Many African SEZs are located in coastal or flood-prone areas, exposing them to climate risks that threaten long-term investment viability.

Climate-resilient SEZ design requires flood-resistant drainage and utilities, climate-proof transport links, resilient water and waste systems, and land-use planning that accounts for sea-level rise and extreme weather. UNCTAD has warned that failure to integrate resilience into SEZ infrastructure creates hidden future liabilities that undermine investor confidence and public finances. Climate-resilient zones, by contrast, protect assets, jobs and surrounding communities, reinforcing linkages between SDG 13 and SDG 11.

Strengthening SEZ authorities and IPAs for climate action

Institutional capacity is a recurring theme in recent World Investment Reports. Attracting and managing climate-aligned investment requires SEZ authorities and investment promotion agencies with expertise in energy systems, sustainability, ESG standards and project structuring.

Key actions include developing clear green investment pipelines within SEZs, partnering with development finance institutions to de-risk renewable projects, building staff capacity in climate finance and ESG, and tracking emissions and resilience indicators at zone level. Authorities that evolve into active facilitators of climate-aligned investment, rather than passive administrators, will be best placed to deliver SDG 13 outcomes.

climate-smart SEZs for a low-carbon future

SDG 13 reframes the future of SEZs. Zones can either entrench carbon-intensive, climate-vulnerable industrial models or become vanguards of the energy transition and climate-resilient industrialisation. Increasingly, only the latter path is economically viable.

By serving as testbeds for renewable energy, low-carbon production and resilient infrastructure, SEZs can align climate action with competitiveness, job creation and long-term development. In doing so, they reinforce progress on SDG 9, SDG 11 and SDG 12, while positioning African economies to attract the next generation of sustainable investment.

Integrated climate action within SEZ strategy is not a cost to growth, it is its strongest safeguard.