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CLIMATE CHANGE: 'Don't Leave it to the World Bank'

Ramesh Jaura

POZNAN, Dec 10 2008 (IPS) - Leading environment groups have opposed plans to hand over financing to check climate change to the World Bank.

Industrialised countries may be required to provide more than 100 billion dollars for developing countries to build low-carbon economies, according to unofficial estimates. This money should not be handled by the World Bank, 142 organisations fighting for climate justice said in a joint statement Tuesday (Dec. 9) at the UN climate talks under way in the Polish city Poznan.

The talks joined by some 11,000 participants from 192 nations began Dec. 1. They enter a critical phase Thursday (Dec. 11) when environment ministers and senior government officials begin the ministerial segment of the talks, and conclude the marathon gathering the next day.

The two-week sessions are a bridge between climate change talks in Bali (December 2007) and Copenhagen, a halfway mark in negotiations on an ambitious and effective global climate change deal due to be concluded in the Danish capital next year.

As discussions continue here on ways to guarantee that developing countries have direct access to mitigation and adaptation funds, the group of non-governmental organisations from around the globe said the World Bank Group was positioning itself to take significant control of climate change financing.

In a joint statement they called instead for climate funds and their utilisation to be made fully accountable to the United Nations Framework Convention on Climate Change (UNFCCC).

The G-77 group of developing countries and China, together representing 133 developing countries at the UN climate talks, are known to favour climate funds under the UNFCCC.

"The World Bank is not a credible institution to play any role in addressing the climate crisis," says Friends of the Earth U.S. international finance campaigner Karen Orenstein. "Its climate investment funds are irreparably flawed and should be shut down.

"Developing countries urgently need billions of dollars – to cope with the increase of storms, droughts, famines and floods that they face due to climate change, and to build low carbon economies. But these funds must come through financial mechanisms controlled by the UN climate convention, in which all parties have equal say."

"It is simply outrageous for climate financing to be given to southern countries in the form of loans," said Lidy Nacpil, coordinator of the Jubilee South Asia/Pacific Movement on Debt and Development.

"Peoples of the South are the most vulnerable to the effects of climate change because of poverty and lack of government programmes and resources, which is in no small part due to the debt they are forced to pay to northern countries," Nacpil added.

"Now the World Bank and northern governments, who bear overwhelming responsibility for the climate crisis, want our people to assume the cost of dealing with its impacts and add to our debt burdens. This is unjust on many levels. Further, it is sheer hypocrisy for the World Bank to claim any role in supposedly assisting the South in addressing the climate crisis when it continues to finance environmentally destructive projects and policies."

The three-page statement signed by organisations from all continents argues that the World Bank is not only a major climate polluter and a major deforester, but a major rights violator. Above all, it is "an undemocratic institution". Besides, the statement says, its recent climate initiatives are severely flawed.

Despite professed concern regarding climate change, the World Bank is actually increasing its support for fossil fuel projects, the document argues. From 1997 to 2007, the Bank is said to have financed carbon dioxide emissions about 45 times the annual emissions of the UK.

In the last year, the World Bank group has increased lending for coal, oil, and gas by 94 percent, totalling over 3 billion dollars. Coal lending alone increased 256 percent in the last year.

The World Bank's own 2004 extractive industries review recommended an immediate end to coal financing and a phase out of investments in oil production by 2008. It found that "…oftentimes the environment and the poor have been further threatened by the expansion of a country's extractive industries sector."

Yet in April 2008, the Bank approved a 450 million dollar loan for a massive 4,000 megawatt coal project in India, expected to be one of the 50 largest greenhouse gas emitters in the world. "Given the World Bank's existing and increasing support for fossil fuels, it is an inappropriate institution to lead the fight against global climate change," the joint statement says.

Backing its view that the World Bank is "a major deforester", the paper says deforestation accounts for some 20 percent of global greenhouse gas emissions, but the Bank continues to promote industrial logging and agrofuels.

A 2007 World Bank inspection panel report strongly criticised the Bank's support for industrial logging and violating the rights of indigenous Pygmy and other forest-dependent communities in the Democratic Republic of Congo, home to the world's second largest tract of rainforests.

The International Finance Corporation (IFC), the private sector lending arm of the World Bank group, finances soy and oil palm plantations, cattle ranching, and shrimp farming in mangrove forests.

The IFC has a long record of support for livestock-based agribusiness, with a 732 million dollar investment over a six-year period for livestock production projects. The UN Food and Agriculture Organisation (FAO) estimates that the livestock sector is responsible for 18 percent of global warming emissions.

The World Bank is a major rights violator, the joint statement says, because numerous communities throughout the world – from those impacted by the Chad-Cameroon pipeline to the Nam Theun 2 Hydropower Project in Laos – have suffered human and environmental rights violations as a direct result of World Bank-backed projects.

The World Bank's Forest Carbon Partnership Facility (FCPF) will include forests in dubious carbon offsetting schemes that allow industrialised countries to buy their way out of meaningful emissions reductions.

"In violation of the Bank's own policies, the FCPF has failed to ensure meaningful participation of indigenous peoples and local communities in its design," the environment groups say.

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