Last week, civil society advocates from across the world convened outside the Washington DC headquarters of the World Bank to protest the Bank’s highly controversial financing of deadly fossil fuel projects.
This report, Banking on Climate Chaos 2022, analyzes fossil fuel financing and policies from the world’s 60 largest commercial and investment banks. We reveal that fossil fuel financing from the world’s 60 largest banks has reached nearly USD $4.6 trillion in the six years since the adoption of the Paris Agreement, with $742 billion in 2021 alone.
Released today, the 13th annual Banking on Climate Chaos report, the most comprehensive global analysis on fossil fuel banking to date, underscores the stark disparity between public climate commitments being made by the world’s largest banks, versus the reality of their largely business-as-usual financing to the fossil fuel industry.
Between 2016, following the adoption of the Paris Climate Agreement, and June 2021, public and private financial institutions poured at least $132 billion in lending and underwriting into 964 gas, oil and coal projects in West, East, Central and Southern Africa. The vast majority of this finance came from financial institutions based outside Africa, both commercial banks and public finance institutions like development banks and export credit agencies.
Today the OECD Export Credit Group announced new restrictions on its support for overseas coal projects. The restrictions do not address export finance for coal mines and related infrastructure, nor oil and gas financing even if the latest IEA report shows that investments in new fossil fuel production need to end this year to limit warming to 1.5°C.
Twelve of the largest central banks around the globe continue to support climate chaos-causing fossil fuels through policy and direct finance, a new report released today finds. Ahead of an annual convening of central bankers in Jackson Hole, Wyoming later this week, the analysis strikes a critical contrast to promises in recent months by the same central banks to align their operations with climate goals.
There is growing recognition that central banks must act to confront the climate crisis. They have the tools to catalyze and accelerate the end of financing for fossil fuels – through monetary policy, regulatory action, and excluding fossil fuel assets from their own portfolios. But, with only limited exceptions, they are not using these tools. This report identifies 10 criteria for assessing central banks against the Paris Agreement’s objective, and applies them to assess 12 major central banks.
Today, 353 organizations from 58 countries released a letter calling on G7 leaders to stop financing fossil fuels; cancel debt payments in global South countries grappling with COVID-19 and climate impacts and pay their fair share of climate finance to global South countries for climate adaptation among other demands.
With only six months left till COP26, the UK host has work to do. Ending public finance for fossil fuel projects overseas shows potential, but the UK’s lack of action on fossil fuels domestically risks undermining its credibility.
Despite the need to rapidly wind-down fossil fuels to avert the worst of the climate crisis, governments worldwide continue to prop up fossil fuel production with huge sums of public money. They may be breaking international law.