Senior officials from Canada and Europe are urging the World Bank to end its investments in coal- and oil-related projects and gradually phase out gas, three separate sources told the Reuters news agency late last month.
In a six-page letter dated February 24, “World Bank executive directors representing major European shareholder countries and Canada, welcomed moves by the Bank to ensure its lending supports efforts to reduce carbon emissions,” Reuters writes. “But they urged the Bank—the biggest provider of climate finance to the developing world—to go even further.”
The letter, which the news story attributes to European officials, calls on the bank to “now go further and also exclude all coal- and oil-related investments, and further outline a policy on gradually phasing out gas power generation to only invest in gas in exceptional circumstances.”
The letter cited the bank’s decision in January to invest US$620 million in a massive and massively controversial liquefied natural gas megaproject in Mozambique, but did not ask the agency to cancel the funds, Reuters says.
A World Bank official responded that the institution is already taking action, pointing to $83 billion it had invested in climate action over the last five years. “Many of the initiatives called for in the letter from our shareholders are already planned or in discussion for our draft Climate Change Action Plan for 2021-2025, which management is working to finalize in the coming month,” the official said in an email to Reuters.
Days before the news report, World Bank President David Malpass told G20 finance officials to expect “record investments in climate change mitigation and adaptation for a second consecutive year in 2021,” Reuters writes.
“Inequality, poverty, and climate change will be the defining issues of our age,” Malpass said. “It is time to think big and act big in finding solutions,”
At the time, he told the news agency that both the World Bank and the International Monetary Fund (IMF) were looking at how to take climate change into account as they open negotiations to reduce unsustainable debt loads for some of the world’s poorest countries. “There’s a way to put together…the need for debt reduction with the need for climate action by countries around the world, including the poorer countries,” Malpass said.