The World Bank has inserted itself as a major player in the climate change arena. Throughout 2008, the World Bank has advanced several major initiatives with a purported goal of helping developing countries reduce greenhouse gas emissions and adapt to climate change impacts. However, on closer inspection, are they really reaching their goal?
The World Bank, the world's largest multilateral lender for fossil fuel projects, plans to reinvent itself as the world's leader on climate and development. It has proposed at least two new "Climate Investment Funds" to help "developing countries to address urgent climate change challenges." But a closer look at these funds reveals that the Bank would continue to fund greenhouse gas emissions, while re-branding its business as usual as "transformational, low-carbon" technologies.
Friends of the Earth International releases a new report in concert with 8 other agencies exposing the the World Bank's new energy framework, which was mandated by the G8, is still business as usual. Despite the promises to "green" their lending practices, it has been shown that the World Bank is still spending upwards of 3 billion dollars on greenhouse gas-producing energy projects.
How the World Bank's Private Arm Fails the Poor and the Environment
Much of IFC's portfolio is oriented toward the interest of corporations, not necessarily the interest of the poor or environmental protection in the developing world. The report highlights certain sectors that often cause more developmental problems than benefits, such as the extractive industries -- oil, gas and mining -- which tend to cause severe environmental and social problems for communities.
The World Bank Group has steadily increased its support of the private sector over the years and its private sector lending arm, the International Finance Corporation (IFC), is an increasingly important facilitator of private investment in the developing world. A part of the World Bank Group whose mission as a development institution is to promote development and alleviate poverty, IFC's lending to the private sector is often at odds with this mission.
How the World Bank is Failing to Adequately Finance Renewable Energy for Development
The World Bank Group has emphasized the global leadership role it hopes to play in addressing climate change and financing for renewable energy. But this report shows that the World Bank group is missing a tremendous opportunity - and failing to fill an urgent need - by not adequately financing renewable energy and energy efficiency in developing countries.
If the World Bank Group is to deliver on the potential of renewable energy to promote development and poverty alleviation, it will have to dramatically increase its funding for renewable energy, both in absolute terms and as a proportion of its overall energy funding.
What the World Bank's New "High-Risk/High-Reward" Strategy Means for the Poor and the Environment
In a major new water strategy paper issued in February 2003, the World Bank's management asserted: "To be a more effective partner, the World Bank will re-engage with high-reward/high-risk hydraulic infrastructure, using a more effective business model." In October 2002, the Bank's Board of Directors also endorsed a high-risk approach to the forestry sector; the new Forest Policy allows Bank support for commercial logging operations in rainforests.
The environmental destruction, social upheaval, corruption and repression that are associated with the World Bank's high-risk projects have created tremendous public controversy since the 1980s.2 This is particularly true for large dams, for projects that affect tropical forests, and for investments in the oil, gas and mining sectors.
World Bank Group Support for Extractive Industries in Africa
This report examines the World Bank Group's support for extractive industries (oil, gas, and mining) in Africa over the last 20 years in light of the World Bank's self-proclaimed mission of poverty reduction. It describes the obstacles to using extractive industries as a vehicle for poverty alleviation and sustainable development, and poses a series of research questions related to the role of the World Bank Group in extractive industries.
The exploitation of petroleum and mineral reserves has long been the predominant source of revenue for a number of resource-rich countries in sub- Saharan Africa. Sub-Saharan states such as Angola, Botswana, Sierra Leone, and Zambia are among the most mineral or oil dependent in the world, and the region as a whole is second only to the Middle East in its dependence on extractive industries for foreign exchange earnings.
The World Bank and Sustainable Development
The 1992 Earth Summit in Rio de Janeiro over a decade ago represented one of the more significant global attempts to make the link between environment and development issues, in order to deepen understanding of the root causes of environmental degradation. Agenda 21, a key outcome from the Earth Summit, recognized that environmental sustainability cannot be achieved in a world with vast wealth disparities, extreme poverty, and a lack of control over natural resources by local communities.>
At the same time, powerful governments, influenced by large corporations, refused to define key terms in the outcomes, terms such as over-consumption or "sound macro-economic policies that promote efficient use of resources," let alone development. Similarly, efforts to expose the links between specific economic policies, poverty and environmental degradation were thwarted. The World Bank's 1992 World Development Report (WDR), Development and the Environment, contributed to the Rio Summit's compromises. The 1992 WDR, while emphasizing that environment is a cross-cutting issue, raised the profile of the concept of an "Environmental Kuznets Curve" which can be translated simply to 'grow now and fix the environment later.'
How the World Bank's Insurance Arm Fails the Poor and Harms the Environment
The Multilateral Investment Guarantee Agency (MIGA) is a little-known publicly funded institution whose environmental and social impact spans the globe. MIGA is part of the World Bank Group. Unlike the better-known parts of the Bank that provide loans to governments, MIGA underwrites the private sector. The agency guarantees the investments of corporations and banks against political risk. Since its 1985 inception, MIGA has provided more than $7 billion in political risk insurance for projects in 75 countries.
Although it is a public institution, MIGA often operates with the secrecy of a private corporation. Despite the difficulty in accessing information about MIGA's investments, however, the agency's anti-environmental record is apparent. So is the agency's failure to achieve the World Bank's mission to promote economic development and poverty alleviation. MIGA has supported projects including Coca-Cola plants, breweries, a Marriott hotel and casino, a Citibank office building, a barge-mounted diesel power plant, a cross-border gas pipeline that traverses fragile ecosystems, and several large mines that have caused significant environmental damage and social dislocation.