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World Bank Annuals 2023 - Will Ajay Banga Act on Climate?

2023 is becoming known as a record-breaking year; for global air temperature, flooding, wildfires, and in general the impacts of climate change. The crisis is already impacting millions of lives and the potential effect of future disasters are terrifying populations across the world. But we don’t all suffer the same. Those among us from: historically marginalised; oppressed communities; in nations more vulnerable to the effects of climate change; or impacted by poverty are particularly affected. The World Bank positions itself as the people’s bank, with its mission of addressing poverty and development more widely. The bank itself has great power through its significant funds to improve people’s lives and those of future generations and it has pledged to do so by signing the Paris Agreement.

The Paris Agreement outlines a commitment to limit global warming to within 1.5ºC in order to prevent catastrophic impacts on society and our environment. Despite this commitment and understanding of the severity of the crisis, the bank has invested more than $15 billion into fossil fuels since the signing, claiming the title of the largest investor in fossil fuels out of any multilateral development bank. This directly undermines the Paris Agreement and continues to worsen the crisis, endangering millions of lives. 

The World Bank Annual Meetings are taking place from the 9th-15th of October. This is a chance for the people to influence their bank. We must call on the bank to transform the way it works to protect our future rather than worsen it, and to be transparent on its investments and loans so that we are able to challenge projects that work against our own interests. The bank is currently working on its new roadmap for reform, so by building pressure at these meetings, we will be able to influence the level of ambition outlined in its roadmap. We know by directly financing projects and through many other indirect finance flows that they bankroll billions of dollars to coal, oil, and gas projects. 

2023 is also a year of opportunity. The newly appointed head, Ajay Banga, has the potential to be a fresh breeze from the previous climate denier (David Malpass).  But Banga must prove himself and the direction of the bank in relation to its climate policies. The bank does not have all of its ducks in a row to align with the Paris Agreement. Its continuous investment in fossil fuel projects contradicts this. What's more, the International Energy Agency have told us yet again (see NZE report) that no new fossil fuel projects should be constructed. They not only have disastrous effects for both people and the planet, but they will likely become stranded investments as renewable energy expands. 

2023 breaks another record, this year we will likely see the number of people without access to electricity increase. Despite the enormous investment from the World Bank into fossil fuels since 2016, only 9% have indicated that they increase energy access.The bank claims that investment in fossil fuels meets the necessary urgent development needs of countries as they are an important driver of development, necessary to bring in revenue, create jobs, and provide energy access. However, this is deeply misleading; in reality, local populations suffer health impacts, and loss of livelihoods, all disproportionately impacting the most vulnerable communities, including women and children. The profits from these projects are funneled into the pockets of rich investors in foreign countries. If Ajay Banga’s vision for the bank is ‘to create a world free from poverty on a livable planet’, then he must prioritise investment into the just energy transition, cutting all financial investments linked to fossil fuel projects. 

We therefore encourage you to join us, in making our voices heard and demanding the bank starts to represent the interests of people on the ground.