Rich countries promised to allocate 100 billion dollars a year to develop projects against climate change. Not only have they not fulfilled what was announced. An investigation of Reuters It also verified that part of the money that they have invested has gone to strange businesses. For example: a coal plant, a hotel and even a chain of chocolate shops.
The rich countries – and the most polluting ones – made the commitment in the framework of the Paris Agreementin 2016. The declared objective was to work so that before 2020 they had the capacity to mobilize 100 billion dollars a year, to help countries with fewer resources to adapt to climate change or reduce greenhouse gas emissions.
Italy helped a retailer open chocolatiers and ice cream parlors in Asia. The United States offered a loan for the expansion of a hotel in Haiti. Belgium financed a love movie set in the Argentine jungle. And Japan: It paid for an airport expansion in Egypt and is financing a new coal plant in Bangladesh.
Only these five projects added 2 thousand 600 million dollars. And the four countries reported them as part of the so-called “climate financing” to the United Nations Organization (UN), although they had little or nothing to do with the fight against climate change. But these cases are just a small example of all the irregularities around these subsidies.
Climate change money is reported irregularly
The system is designed to cheat. The pledge came without official guidelines on what activities count as “climate finance.” Nor does it oblige governments to report details. The UN climate change secretariat told Reuters it was up to countries themselves to decide whether to impose uniform standards. The rich countries, of course, have refused.
Cases such as the coal plant or the chocolate shops became known because reporters from Reuters and Big Local News, a journalism program at Stanford University, asked 27 countries for details about what they reported to the UN. In addition, they reviewed public documents and spoke with NGOs and others involved in the projects. They also compared the reports to the UN with information recorded by other agencies.
The descriptions of the projects financed are usually so vague that in thousands of cases the country to which the money was destined is not even mentioned. Even the countries supposedly benefited were sometimes unable to clarify how the money was spent, according to the investigation.
More of $65 billion, for example, was so inaccurately reported that it’s impossible to explain what the money was spent on.. Another $500 million was reported as part of “climate financing,” but corresponds to projects that were later canceled without paying the funds.
France reported a $1.181 million loan to a Chinese bank for environmental initiatives, as well as loans totaling $267.5 million for improvements to a metro system in Mexico and $107.6 million for port improvements in Kenya. None of these plans were executed.
Governments justified their expenses
Reuters got some governments to respond. They did, however, to justify the situation. A US State Department spokesman said the money from the hotel — part of a Marriott hotel franchise — counts for the fight against climate change because it includes stormwater controls.
The Belgian government defended the love-in-the-jungle movie because, it said, it was at some point about deforestation. An Italian government official said his government aims to consider climate issues in all its funding, but did not provide an explanation of how chocolate shops meet this goal.
Japan is the largest financier of the agreement, according to reports. It has loaned at least $9 billion for projects that will continue to rely on fossil fuels, according to research from Reuters. Some of these even increase emissions instead of reducing them. Among them, the coal-fired power plant that it is building on Matarbari, an island off the southeast coast of Bangladesh, which would be up and running by 2024.
On projects reported as investment that were never done, French and US officials involved in the UN reports said funds are documented in the year they are committed. They explained that the reports are not reviewed to correct them.
The money invested is much less, says OXFAM
Of the $100 billion dollars a year promised, the governments assure that they reached $83.3 billion in 2020, the year that the deadline had expired and the last one they reported. The international organization OXFAM published yesterday a “climate finance shadow report” which ensures that the contribution in that year was much lower: maximum, about 24 thousand 500 million.
OXFAM subtracts from the total amount money that is given as a loan and not as a grant. “These funds may even harm rather than help local communities, as they add to the debt burden of already heavily indebted countries,” the NGO said in a statement. release.
Almost all the money that France contributes to solutions against climate change does so through loans: 92% of the total. The situation is replicated in other countries such as Austria (71%), Japan (90%) and Spain (88%). OXFAM also draws attention to the alleged support reported by the World Bank and other multilateral development banks: 90% of this financing in 2019 and 2020 was sent to poorer countries as loans.
“This is deeply unfair,” he said. Nafkote Dabi, climate change policy leader at Oxfam International. “They are fatally undermining crucial climate negotiations. They are playing a dangerous game in which we will all lose.”
The amount of money that rich countries specifically earmarked for climate change adaptation in vulnerable nations is between 9 thousand 500 and 11 thousand 500 million dollarssays OXFAM. “People in the United States spend four times that each year feeding their cats and dogs,” Dabi said.
The rules for a new fund against climate change
The emergency is more serious than ever. The Paris Agreement mentions the need to prevent the planet from exceeding the 1.5 °C / 2 °C warming threshold. The past eight years have been the hottest on record, according to an alert from the World Meteorological Organization released in January.
The world average temperature is around 1.2 °C above pre-industrial baseline levels. The scientific community has alerted that the threshold of 1.5°C could be surpassed in 2027.
Since 2012, so-called developing nations or groups acting on their behalf have called for more than 100 times that the rules on funds granted by rich countries be reviewed. This, according to a review of Reuters of UN presentations, climate meeting videos and climate negotiation newsletters.
This year there is a new climate summit. The United Nations Climate Change Conference 2023 will be held from November 30 to December 12 in Dubai. The problem of financing is intended to be a priority on the agenda: what will be the new collection goal, who must contribute, for how long and under what conditions. Clear rules for real help.