A walk down memory lane with the World Bank,

A walk down memory lane with the World Bank,

Date: 16 September 2009

 Historically, the World Bank has been roundly criticised by the World Development Movement and others because of its flawed policies which deepened poverty. Exactly the same critique is as pertinent as ever but relates to its policies on climate change.

In the 1980s, 1990s and 2000s, the World Bank was notorious for damaging developing countries’ economies by forcing them to adopt economic policies that made people poorer. The institutional problem of flawed analysis that gave the much-maligned institution its poor reputation can still be seen today when examining its policies designed to tackle climate change.

Rightly, the World Bank knows that climate change will devastate poor countries and is already increasing poverty and in its annual World Development Report released today, it called on nations to ‘act differently on climate change’.

Also correctly, the World Bank says that the world’s reliance on fossil fuels must be broken. But in its typically contradictory style, it is currently funding new dirty coal power stations to be built in the global south through the ‘Clean Technology Fund’.  Also reminiscent of the past, the UK government is blindly and wrongly channelling £400 million of ‘green’ aid money to this fund, which constitutes half of the UK’s budget for tackling climate change across the world.

When discussing this with Ricardo Navarro, a campaigner from El Salvador his mistrust of the institution was clear, he said: ‘If you look at the history of the World Bank, you will see that they have been at the centre of many problems in Central America. The World Bank has a history of funding projects that hurt the poorest people and cause climate change and so this is nothing new. The UK should not give this World Bank fund a pound, I would rather that the UK government bought flowers for every household in the UK than spend this money on a World Bank coal fund.’

Both campaigners in the global South and the governments of Southern countries oppose the World Bank’s involvement in tackling climate change. They argue that because rich countries dominate decision-making at the Bank, when they determine how climate change is tackled, they ensure that the benefits lie with Western multinational companies, rather than to provide positive low carbon development for the poor.

Rather than imploring nations to ‘act differently’, it is high time that the World Bank looked carefully at its own policies, learns from the grave mistakes of its tarnished past, and thinks and acts differently to tackle, rather than exacerbate, poverty and climate change.