As the 2024 World Bank Annual Meetings draw to a close, the World Bank Group’s journey to create a world free of poverty on a livable planet continues. With COP29 around the corner, “climate finance” are the words on everyone’s lips. The role of the Bank in this remains a key focus.
A recent report by Urgewald on trade finance uncovered hidden billions – estimated $4.7 billion – flowing from the Bank to oil and gas in FY2023, “an increase of 28% in fossil fuel financing compared to FY2022.” And it’s not just the amount of finance that is of concern, but the impacts of the finance. In its recent report Oxfam found that for each project, the amount budgeted and the actual eventual expenditure differed drastically, making tracking of project impacts extremely difficult.
In a similar vein, findings from Bretton Woods Project’s recent report suggest that “the Bank’s approach to Paris alignment is being used to a significant extent to impose ‘green’ conditionalities on borrowing countries, especially in the Global South.” Furthermore, throughout discussions this week, World Bank representatives repeated their focus on the role of fossil gas as a necessary transition fuel (in “specific cases”) for developing countries, despite all the evidence to the contrary and despite first-hand accounts of the devastating impacts of fossil gas, while failing to provide clean, affordable, and reliable energy access.
As part of the Bank’s global challenge to address energy access, it has announced Mission 300, connecting 300 million people to electricity in Sub-Saharan Africa by 2030, all while adhering to its commitment to the goals of the Paris Agreement.The launch focused on opportunities for the private sector, but people and communities must be part of the planning and implementation.
According to the Banking on Renewables campaign, “The MDBs have the opportunity – and the mandate – to ensure that all investments in renewable energy are held to the highest standards for human rights, social impacts and environmental integrity, with robust and accountable safeguards and full consultation with affected communities”.
Fiza Qureshi, Gas Campaigner for Big Shift Global said, “Fossil gas cannot be the bridge to a sustainable future; it is a detour that undermines both climate goals and gender equity. The World Bank must heed the voices of civil society and taxpayers urging a responsible exit from gas financing. Instead of promoting fossil gas as a ‘transition fuel’ for developing countries, let us invest in clean, indigenous renewables like solar and wind. These solutions empower communities, support gender equality, and align with the Paris Agreement’s ambitions. It’s time for the Bank to fulfil its role and champion a truly sustainable future.”
Karabo Mokgonyana, Renewable Energy Campaign from Power Shift Africa said, “The World Bank Annual Meetings underscored an urgent truth: achieving a sustainable future demands breaking the chains of debt and decisively ending fossil fuel financing. If we are to build a world where climate goals and economic sovereignty go hand in hand, global finance must transform to deliver accessible, equitable support for the Global South. Only then can we unlock the full potential of renewable energy to drive inclusive growth and resilience.”
Aaron Pedrosa from Philippines Movement for Climate Justice said, "Despite 80 years of existence, the World Bank continues to be averse to remedy. Hence IFC, it's private sector arm, has largely been unchecked for harms caused despite the existence of its own performance standards. It should not be allowed to continue funding death and destruction to communities, the environment and the climate. This is the message of the 19 communities across the Philippines hosting coal plants privately funded by the World Bank: stop funding fossil fuels, stop the harms, deliver remedies now!"
Anitha Sampath from Centre for Financial Accountability, India said, "As the Indian experience shows, increasing renewable energy capacity alone will not bring people out of poverty, improve energy access, or save nature. We need a just energy transition, which means avoiding damaging, extractive mega-scale solar or hydro projects and false solutions like 'waste to energy' or 'green hydrogen'. The World Bank must keep communities and nature at the heart of their operations, to ensure a democratic, sustainable energy system for all.”
Alison Doig, clean energy campaign manager at Recourse said, "It seems that Ajay Banga has forgotten that the World Bank is a development bank, as he rolls out the red carpet for private sector companies and the fossil gas industry. To truly walk the talk of ending poverty on a livable planet, Banga should be giving women, youth and Indigenous people the front row seat, and driving a just transition to a renewable-powered, climate-safe world."
Fran Witt from Recourse said, "How can the World Bank reconcile the dash for private capital with the need for reparative justice and people centred development? MIGA guarantees that de-risk private investment in sensitive environments are supporting fossil fuel build out in some countries; financial intermediary lending gives private banks the green light to finance companies without adequate safeguards, and development policy finance can set green conditionalities that in turn tie countries in to fossil fuels for export so that they can pay back their unsustainable debts. It's time for a radical rethink of how the World Bank does business. G20 nations must accept their historical responsibility for the climate crisis and provide the reparative and grant-based finance necessary for human development."
Dustin Schaefer from Urgewald said, “This annual meeting confirmed President Banga’s obstinate course towards private capital mobilization as an end in itself. Our latest research shows how growing amounts of trade finance are flowing into oil and gas. Through the IDA Private Sector Window, scarce public money is being used to de-risk trade finance – without a semblance of transparency or accountability. We call on the World Bank shareholders to use this week’s IDA negotiations to stop the wanton awarding of billions in trade finance until an audit has provided clarity about the use and impact of these funds.”
Jason Weiner from Bank Climate Advocates said, “Considering the climate crisis, it is remarkable that IFC, and its member states when acting on IFC’s behalf, are still not adhering to their obligations under IFC’s policies, the Paris Agreement, and international human rights law to assess and avoid GHG emissions from its investments. 3–3.6 billion people that live in contexts highly vulnerable to climate change are already suffering from the devastating impacts of global warming, and things are only going to get worse...Our planet and its most marginalized people can’t handle further significant GHG emissions, and especially ones that IFC, with tremendous resources at its disposal, can and has the duty to avoid. BCA’s data documents that just 235 IFC investments from 2012-present, account for over 168,000,000 tons of avoidable GHG emissions per year – which is roughly equivalent to what the Netherlands emits annually and does not even include the significant emissions IFC impermissibly fails to quantify for each of its investments.”