Export-Import Bank of Korea: Out of Climate!
The Green Climate Fund (GCF) Board holds its 14th board meeting in Songdo, Korea starting tomorrow, during which it will decide, among others, on accrediting certain institutions such as export credit agencies (ECA) to be implementing partners. One such ECA is the Export-Import Bank of Korea (KEXIM),whose pending application for accreditation poses yet another threat to the very Fund established “to promote the paradigm shift towards low emission and climate-resilient development pathways by providing support to developing countries”.
KEXIM’s record speaks for itself. In the backdrop of KEXIM’s commitment to “green initiatives and sponsorship for sustainable growth, it provided US$3.8 billion for overseas coal-fired power plant projects from 2007-2014, KEXIM ranks 5th among the world’s largest institutions in public finance for coal. It has been the biggest channel for supporting Korean companies develop fossil fuel resources and export coal-fired power plants to developing countries. In comparison, it has only made available US$2.9 billion for climate change-related projects over the last 25 years, since 1991.
KEXIM rides on the Korean government’s continuing support for the dirtiest of fossil fuels – coal – a stark contrast to the national vision of “low carbon and green growth”. Among OECD countries, Korea is the second largest in terms of export credit support for coal projects.The country itself is 7th in the world for coal consumption, depending on coal-fired power plants for up to 40% of its electricity needs. It has not lifted a finger to bring its coal-burning corporations at home and abroad in line with these pronouncements.
Korea’s new climate targets as of June 2015 in fact propose an increase ofemissions between 2020 and 2030. Although targets for 2030 appear as a 15-31% reduction from a business-as-usual emissions pathway, but they actually translate to a 4-31% hike from 2-5 levels.
Ignoring the existence of clean, sustainable energy alternatives in many developing countries, the Korean government justifies its support for coal use position by emphasizing the ‘energy welfare’ needs of impoverished peoples. What it substantively justifies however, is protecting and securing the operations and profit-making of its coal investments. In effect, it encourages sustained production of the single biggest contributor to the climate crisis, and by providing public finance no less for coal through KEXIM, it uses the Korean people’s money to trap developing countries into unsustainable, profit-greedy economic directions running on dirty energy use and a future wasteland of more intense climate-related catastrophic events.
With climate change reaching levels of a planetary emergency, the GCF cannot afford to shirk from remaining true to its mandate of mobilizing financial resources for a low carbon and sustainable future. Already this has been threatened by the Fund’s earlier accreditations of entities implicated in dirty energy funding such as HSBC and Crédit Agricole. Accrediting ECAs like KEXIM which primarily serve to promote exports and generate jobs in their home countrieswould be a betrayal of this trust, running counter to the Fund’s core principles such as ensuring country ownership and benefits for local sustainable development. It would also be an act with dire, tragic consequences especially for developing peoples for whom this very Fund was created andwho bear the harshest impacts of a crisis they not cause.
KEXIM – Quit coal! Out of climate! No to continued coal funding by the Korean government!
No to public money in dirty energy!
No to GCF accreditation of KEXIM!Resist all attempts to erode the mandate of the GCF for low carbon sustainable development pathways!