Get Red Pepper's email newsletter. Enter your email address to receive our latest articles, updates and news.

×

Off-message at the World Bank

A World Bank internal report has urged that the institution should cease investing in fossil-fuel projects. Sadly, the bank is unlikely to act accordingly.

August 1, 2004
4 min read

On a grey afternoon in Sheffield earlier this year, at the end of a day school on climate change, I heard a most remarkable thing: a review commissioned by the World Bank had recommended that the institution should stop funding fossil-fuel projects by 2008. Had the bank come to grips with its global responsibilities?

The Extractive Industries Review (EIR) was commissioned in 2001 to examine what role, if any, the World Bank has in the extractive industries (oil, gas and mining). It contained many criticisms of bank practice in this area, and suggested that in some cases World Bank involvement even made situations worse.

Predictably, the bank’s management was having none of it and advised that the EIR’s bold recommendations should be rejected. The official response is due in mid-July and is likely to pooh-pooh such utopian recommendations as spending the bulk of bank funding on renewables, rather than fossil fuels. Yet the report and the responses it has generated highlight some interesting issues. They hold some useful lessons for the G8 summit, which is taking place in the UK next year.

The EIR builds on concerns that NGOs had raised for years about bank projects. However, this time the concerns – impacts on human rights and climate change – came out of a process initiated from within the bank itself. Headed by former Indonesian environment minister Dr Emil Salim, the EIR is written in the bank’s language and makes recommendations in a context of what is possible within its working practices.

Salim may have used the bank’s language but, as far as key decision-makers were concerned, he had surely picked up the wrong hymn sheet. For the political realities of the World Bank mean that the chances of the bank ending its subsidies to fossil fuels are pretty slim.

To start with, decisions in the bank are dominated by the world’s most oil-hungry countries. The majority of oil pumped in bank-funded projects feeds demand from those countries” electorates, and most of the subsidies provided by the bank feed demand from their fossil-fuel corporations. According to the US-based Sustainable Energy and Economy Network, these companies have received World Bank-approved financial packages worth more than $10.7 billion since 1992. The bank also acts as a politically low-risk vehicle for securing new energy supplies, particularly ones outside the Middle East – a region increasingly unsafe for Western oil workers and unstable for Western markets.

Another aspect of the World Bank’s appeal as a partner for more commercial ventures is its thin veneer of moral legitimacy, for the bank has an institutional mandate to alleviate poverty. Backing up the EIR’s concerns, a recent report from the New Economics Foundation (NEF) says that countries tend to go deeper into debt as a result of global energy policies” emphasis on fossil fuels.

The Price of Power states that the infrastructure needed for fossil-fuel distribution is expensive and highly centralised, and does little for overall access to energy. Reliance on imported fossil-fuel-based energy locks countries into a dependency relationship with multilateral donors and foreign companies. Poorer countries are thus driven deeper into debt. The report concludes that even a small shift away from fossil fuels towards clean renewable energy could save millions of lives and help avert climate change.

The World Bank’s inevitable rejection of the EIR’s recommendations will not be the tragic end to this particular tale. For the most dominant decision-makers at the bank are practically the same bunch of people that will attend the G8 summit when it comes to Scotland next June. If Tony Blair has his way, this unofficial gathering of the world’s most industrialised countries will place the twin perils of climate change and global poverty at the top of its agenda.

Gordon Brown’s interest in debt relief should lead to plenty of fine words on the subject of tackling poverty. Oxfam is running a campaign “to make poverty history”; but the evidence is becoming irrefutable that unless the fossil-fuel industry becomes history, poverty will remain part of the present. Those who kicked the EIR into the long grass less than 12 months before the Scottish jamboree will be all too keen to forget this, however, leaving it to social-justice campaigners to make sure that the message is brought home.

Red Pepper is an independent, non-profit magazine that puts left politics and culture at the heart of its stories. We think publications should embrace the values of a movement that is unafraid to take a stand, radical yet not dogmatic, and focus on amplifying the voices of the people and activists that make up our movement. If you think so too, please support Red Pepper in continuing our work by becoming a subscriber today.
Why not try our new pay as you feel subscription? You decide how much to pay.

Working class theatre: Save Our Steel takes the stage
A new play inspired by Port Talbot’s ‘Save Our Steel’ campaign asks questions about the working class leaders of today. Adam Johannes talks to co-director Rhiannon White about the project, the people and the politics behind it

The dawn of commons politics
As supporters of the new 'commons politics' win office in a variety of European cities, Stacco Troncoso and Ann Marie Utratel chart where this movement came from – and where it may be going

A very social economist
Hilary Wainwright says the ideas of Robin Murray, who died in June, offer a practical alternative to neoliberalism

Art the Arms Fair: making art not war
Amy Corcoran on organising artistic resistance to the weapons dealers’ London showcase

Beware the automated landlord
Tenants of the automated landlord are effectively paying two rents: one in money, the other in information for data harvesting, writes Desiree Fields

Black Journalism Fund – Open Editorial Meeting
3-5pm Saturday 23rd September at The World Transformed in Brighton

Immigration detention: How the government is breaking its own rules
Detention is being used to punish ex-prisoners all over again, writes Annahita Moradi

A better way to regenerate a community
Gilbert Jassey describes a pioneering project that is bringing migrants and local people together to repopulate a village in rural Spain

Fast food workers stand up for themselves and #McStrike – we’re loving it!
McDonald's workers are striking for the first time ever in Britain, reports Michael Calderbank

Two years of broken promises: how the UK has failed refugees
Stefan Schmid investigates the ways Syrian refugees have been treated since the media spotlight faded

West Papua’s silent genocide
The brutal occupation of West Papua is under-reported - but UK and US corporations are profiting from the violence, write Eliza Egret and Tom Anderson

Activate, the new ‘Tory Momentum’, is 100% astroturf
The Conservatives’ effort at a grassroots youth movement is embarrassingly inept, writes Samantha Stevens

Peer-to-peer production and the partner state
Michel Bauwens and Vasilis Kostakis argue that we need to move to a commons-centric society – with a state fit for the digital age

Imagining a future free of oppression
Writer, artist and organiser Ama Josephine Budge says holding on to our imagination of tomorrow helps create a different understanding today

The ‘alt-right’ is an unstable coalition – with one thing holding it together
Mike Isaacson argues that efforts to define the alt-right are in danger of missing its central component: eugenics

Fighting for Peace: the battles that inspired generations of anti-war campaigners
Now the threat of nuclear war looms nearer again, we share the experience of eighty-year-old activist Ernest Rodker, whose work is displayed at The Imperial War Museum. With Jane Shallice and Jenny Nelson he discussed a recent history of the anti-war movement.

Put public purpose at the heart of government
Victoria Chick stresses the need to restore the public good to economic decision-making

Don’t let the world’s biggest arms fair turn 20
Eliza Egret talks to activists involved in almost two decades of protest against London’s DSEI arms show

The new municipalism is part of a proud radical history
Molly Conisbee reflects on the history of citizens taking collective control of local services

With the rise of Corbyn, is there still a place for the Green Party?
Former Green principal speaker Derek Wall says the party may struggle in the battle for votes, but can still be important in the battle of ideas

Fearless Cities: the new urban movements
A wave of new municipalist movements has been experimenting with how to take – and transform – power in cities large and small. Bertie Russell and Oscar Reyes report on the growing success of radical urban politics around the world

A musical fightback against school arts cuts
Elliot Clay on why his new musical turns the spotlight on the damage austerity has done to arts education, through the story of one school band's battle

Neoliberalism: the break-up tour
Sarah Woods and Andrew Simms ask why, given the trail of destruction it has left, we are still dancing to the neoliberal tune

Cat Smith MP: ‘Jeremy Corbyn has authenticity. You can’t fake that’
Cat Smith, shadow minister for voter engagement and youth affairs and one of the original parliamentary backers of Corbyn’s leadership, speaks to Ashish Ghadiali

To stop the BBC interviewing climate deniers, we need to make climate change less boring
To stop cranks like Lord Lawson getting airtime, we need to provoke more interesting debates around climate change than whether it's real or not, writes Leo Barasi

Tory Glastonbury? Money can’t buy you cultural relevance
Adam Peggs on why the left has more fun

Essay: After neoliberalism, what next?
There are economically-viable, socially-desirable alternatives to the failed neoliberal economic model, writes Jayati Ghosh

With the new nuclear ban treaty, it’s time to scrap Trident – and spend the money on our NHS
As a doctor, I want to see money spent on healthcare not warfare, writes David McCoy - Britain should join the growing international movement for disarmament

Inglorious Empire: What the British Did to India
Inglorious Empire: What the British Did to India, by Shashi Tharoor, reviewed by Ian Sinclair

A Death Retold in Truth and Rumour
A Death Retold in Truth and Rumour: Kenya, Britain and the Julie Ward Murder, by Grace A Musila, reviewed by Allen Oarbrook