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Lending loopholes expose World Bank to indirectly financing ‘coal boom’ in Asia

The lending arm of the World Bank is providing loans to institutions that finance the development of coal-based power projects, according to a new report. The projects not only pose an environmental risk to the planet, locally they destroy homes and displace communities. The loans subvert strong warnings from the head of the World Bank that expanding coal in Asia is a dangerous proposition.

By Tom Murphey

Asia, October 7, 2016

Humanosphere

The lending arm of the World Bank is providing loans to institutions that finance the development of coal-based power projects, according to a new report. The projects not only pose an environmental risk to the planet, locally they destroy homes and displace communities. The loans subvert strong warnings from the head of the World Bank that expanding coal in Asia is a dangerous proposition.

The International Finance Corporation (IFC), the private-sector lending arm of the World Bank, invests in finance institutions than go on to provide loans to energy companies, according to Inclusive Development International. While the IFC does not directly fund coal projects, it admits that it may be exposed in some of its deals. As a result, IFC indirectly supports at least 91 projects deemed “harmful” in the report, 41 of which are coal projects.

That includes the 1,320-megawatt Rampal power station in Bangladesh, a project the World Bank declined to directly fund. It is to be built in the Sundarbans Forest, destroying habitats for many endangered and threatened species, just a few miles from the world’s largest mangrove forest.

Read more at Humanosphere

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