New World Bank Guidelines Should Mainstream Climate Change in Loan Portfolios, Says WRI Report
Jul 06 - U.S. Newswire
As the Group of 8 Summit opens in Gleneagles, Scotland, a new World Resources Institute (WRI) report offers a recommendation for world leaders seeking to address climate change: require the World Bank to mainstream climate change considerations into its global operations in partnership with developing countries.
"The G8 should call on the World Bank to increase efforts to stop
climate change. The Bank should identify and then help fund the incremental
costs of financing a clean energy future," said Jon Sohn, a senior
associate at WRI, who co-authored "Mainstreaming Climate Change
Considerations at the Multilateral Development Banks" along with WRI's
Smita Nakhooda and Kevin Baumert.
The new WRI report investigates the limited extent to which climate change
issues have been included in the World Bank Group's country assistance
strategies, energy-sector loans and project lending and recommends structural
reforms to improve Bank lending practices. For example, in the last five years,
more than 80 percent of all World Bank lending in the energy sector did not even
consider climate change in project loans.
Additionally, the report reviews national obligations under the Framework
Convention on Climate Change (noting commitments by countries to develop
national mitigation programs), as well as current actions being taken by key
World Bank clients. For example, China recently passed a renewable energy law
and pledged to increase its installed renewable energy generating capacity to 60
gigawatts - - about 10 percent of its total power capacity -- by 2010. The
report also highlights efforts by the Bush Administration to slow down support
for specific projects and initiatives of the World Bank to reduce greenhouse gas
emissions in key developing countries.
If multilateral development banks (MDBs) like the World Bank were to identify
the additional costs of financing greenhouse gas emissions reductions, it would
help mobilize the international community to finance these costs. To this end,
the new WRI report recommends that the World Bank and other MDBs:
-- revise guidelines for country and sector strategies to explicitly
integrate climate change considerations
-- develop a GHG accounting and options analysis framework
-- integrate the analysis framework into operations in key sectors, and
-- initiate pilot work to reduce GHG emissions at the sector level in
partnership with interested client countries.
On June 11, the G7 Finance Ministers Pre-Summit statement endorsed this
direction, noting that "we stress the importance of energy efficiency,
technology and innovation in ensuring energy security. To help meet the
challenge of climate change, we urge the World Bank and other multilateral
development banks to increase dialogue with major borrowers on energy issues and
put forward specific proposals at their Annual Meetings that encourage cost
effective investments in lower carbon energy infrastructure."
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The World Resources Institute ( http://www.wri.org ) is an independent
nonprofit organization with a staff of more than 100 scientists, economists,
policy experts, business analysts, statistical analysts, mapmakers, and
communicators working to protect the Earth and improve people's lives.
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NOTE:
Journalists may access and download the 12-page report and a graphic in the
WRI Newsroom at http://newsroom.wri.org