FOR IMMEDIATE RELEASE
Contact:
Sophie Richmond, Big Shift Global - srichmond@climatenetwork.org
Nicole Rodel: Oil Change International - nicole@priceofoil.org
Fossil gas phase out commitments missing from World Bank Annual Meetings
11 October, Marrakech - The Annual Meetings of the World Bank Group (WBG) and the International Monetary Fund (IMF) are taking place this week in Marrakech against the backdrop of record breaking temperatures in Morocco this year.
Ahead of the institutions’ joint Development Committee meeting Wednesday, advocates at the Civil Society Policy Forum (CSPF) are watching for new commitments to end funding for all fossil fuels and to cancel unfair debts. A public communiqué from the meeting will set the direction for the WBG for the next six months. Ministerial statements released alongside this also often provide rare public information on individual governments’ positions.
Yesterday World Bank Group President Ajay Banga claimed in an open meeting with civil society that just 0.2% of World Bank direct finance still flows to fossil fuels. But this is not meaningful unless an end to fossil support is written into policy. Even more importantly, it doesn’t account for influential indirect support that flows to fossil fuel projects, especially to LNG, through Development Policy Finance, technical assistance, trade finance, MIGA guarantees or via IFC support via financial intermediaries.
At the centre of discussions in Marrakech is the World Bank’s Evolution Playbook and a new Scorecard that is designed to deliver on that. This Evolution Playbook commits only to “phase down” fossil fuels, but not to “phase out,” and favours shallow governance and debt reforms over the deeper transformations needed.
The WBG is the largest funder of fossil fuels of all multilateral development banks (MDBs). Despite committing to Paris alignment in 2016, Oil Change International data shows that the Bank has financed at least USD 17 billion in fossil fuels since then, including 930 million in 2022. Most of this has flowed to fossil gas, despite evidence that it is at odds with climate and development goals. But research published this month demonstrates that the WBG, despite Banga’s town hall reference to supporting “god forbid, coal in the old days”, is also still funding 68GW of new coal power expansion via the IFC’s financial intermediaries.
As new President Ajay Banga addresses his first Annual meetings, he faces urgent calls to clean up the World Bank including from those suffering the worst climate impacts. Pressure is also on the WBG’s wealthy shareholder governments like United States, Italy, and Germany to keep their promises to work to end public finance for fossil fuels at the institution. The premiere of a mini-documentary today from the Big Shift Global coalition and a team of investigative journalists showcases the impact of this fossil funding on communities in Argentina, Egypt, and Indonesia. No new oil, gas, or coal fields are compatible with limiting global temperature rise to 1.5ºC according to the International Energy Agency and the Intergovernmental Panel on Climate Change.
A commitment to end funding for fossil fuels this week would be a much-needed signal for COP28, where governments are under pressure to deliver on fossil fuel phase out and financial reforms to pay their fair share for a transition to clean energy globally.
Quotes:
Lorraine Chiponda, of the Africa Movement of Movements said: “It is six months into his tenure but he is still refusing to take a stance on the Bank’s continued finance for fossil gas, or even admit that it is still there. President Banga talks about ending poverty and promoting shared prosperity on a ‘liveable planet’ and the science is clear that more funding for fossil gas is not compatible with any part of this vision. Gas — like oil and coal — has not fostered development but instead perpetuated pollution, inequality, and conflict in Africa, with profits often flowing out of the continent.”
Dean Bhebhe of Don’t Gas Africa said: “In a world racing against the clock to achieve net-zero emissions by 2050, investment choices carry more weight than ever. Yet, as gas emerges as a primary culprit behind rising electricity costs, and with wind and solar proving more cost-effective, the financial argument against fossil fuels strengthens. Beyond finance, the human narrative underscores the urgency. From health implications tied to extraction processes to the environmental degradation from flaring, the message is clear: To uplift communities and ensure a sustainable future, the World Bank's actions must be as bold and transformative as its mission. Intentions without corresponding effort mean nothing if we are to truly tackle the climate emergency that has trapped Africa in a cycle of debt, want and need.
Andri Prasetiyo, Researcher at Senik Centre Asia said: “As we head to COP28, we need to make sure the debate for global financial system transformation does not begin and end with the shallow World Bank reforms proposed in the Evolution Roadmap drafts. Ending fossil fuel funding (including-technical assistance) and democratic voting changes are needed at the Bank to make it an effective climate actor. And well beyond the Bank, Paris Alignment will require wealthy governments to pay their fair share for fossil fuel phase out, including by redirecting trillions each year from fossil fuels towards clean energy transition acceleration.”
Fran Witt, campaigner at Recourse, said: “While these meetings happen in Morocco, a country that has abundant sustainable, renewable energy opportunities, the World Bank Group is encouraging the government to build fossil gas infrastructure through its advisory services. This advice could lock Morocco and many other countries into unsustainable energy models that crowd out the potential for renewable energy or energy access. Should it be happening? Absolutely not."
Ute Koczy, Senior World Bank Campaigner at Urgewald, said: “Six months into Ajay Banga’s World Bank presidency and three days into the Annuals in Marrakech, one thing is clear: There is still a lack of ambition in the fight to protect our planet and its people from the looming climate disaster. Whenever the new President was willing to address the Bank’s ongoing support for fossil fuels, he repeated the misleading mantra of 0.2 percent in direct finance. However, painstaking research into the World Bank’s private sector arm, the IFC, demonstrates that the Bank continues supplying billions of US dollars to fossil fuel projects under the guise of trade finance. This opaque and short-lived form of finance keeps on greasing the wheels of the global oil and gas industry and goes largely unchecked and unaccounted for. The only remedy: We need coal, oil, and gas on the Exclusion List to cut them off public money once and for all.”
Sophie Richmond, Big Shift Global Lead, said: “Ajay Banga’s vision of reducing poverty on a liveable planet cannot become reality without tackling the cause of climate change - fossil fuels. And gas is a fossil fuel. The future is clean, affordable, sustainable renewable energy, the Bank needs to move away from the dirty energies of the past and support the shift to a healthier, sustainable, liveable planet.”
Thuli Makama, Africa Director at Oil Change International, said: “The Biden Administration and other wealthy governments are trying to dress up the World Bank as a one-stop shop for climate finance. It is clear that giving the Bank more power and money will just result in more fossil fuels, more debt, and more inequality unless the institution is forced to first change its ways. This emphasis on the Bank is a ploy to avoid doing their fair share to phase out fossil fuels at home and paying their fair share for climate action globally. The Bank’s wealthy shareholder governments cannot hide from their responsibilities any longer. They must phase out fossil fuels at home while ensuring the Bank does what communities around the world have called for for decades: ending all forms of support for fossil fuels, making voting democratic, adding binding human rights and labor standards, and pursuing serious debt cancellation.”
Aaron Pedrosa of the Philippine Movement for Climate Justice, said: "Far from achieving a livable planet through its Evolution Roadmap, the World Bank would further push communities across the global South down the path of death and destruction as it aggressively endorses gas as a transition fuel. The Bank must stop funding fossil fuels, and provide remedy for the communities whose lives and livelihoods have been destroyed by these catastrophic investments."
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