The World Bank Steps in to Save the Day??

The World Bank Steps in to Save the Day??
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Cancún, Mexico - As climate change increases, the World Bank is stepping up its funding for developing nations. On the agenda at this year's COP 16, is the development of a proper institutional financing system, and at the top of the agenda is setting up of a new Climate Fund. Developing countries want the Climate Fund to be under the authority of the UNFCCC, and not to come under the control of the World Bank with which many of them have had bad experiences.

Yesterday morning, World Bank and the Alliance of Small Island States (AOSIS) held a joint press conference to announce funding for clean energy projects in island states. A memorandum of understanding has been signed between AOSIS, the Government of Denmark, the World Bank and the United Nations Development Programme (UNDP).

World Bank President Robert B. Zoellick announced that funding would be made available to low lying nations, which are particularly threatened by rising sea levels. A $14.5 million pledge of support form the Government of Denmark kicks off the initiative, which will help island states in Africa, Caribbean and Pacific Island regions transition to low emission and climate resilient development paths.

Last week, an AOSIS delegate warned that five low lying island states "are facing the end of history. And if that happens, we are all accomplices."

Because of their size and remoteness, most small island developing states are heavily dependent on imported petroleum for their energy needs. Some countries spend an estimated 25-50 percent of their GDP on imported oil, which leads to very high domestic electricity costs. The funds are intended to help them to transition to renewable energy sources.

Not everyone welcomed the news. Yesterday was marked not only by sessions related to the World Bank but also by actions against the World Bank. Campaigners from around the world condemned rich countries' efforts to carve out a special role for the World Bank in managing these funds.

They are furious that the World Bank is being promoted as the hub for climate finance. And they insist that because the institution continues to bankroll dirty fossil fuel projects to the tune of $6.6 billion last year alone - they are in the wrong hands for the funds to fight climate change. They also cite the World Bank's recent history of imposing climate finance as loans, creating new debt for already impoverished countries, increasing the role of the private sector and imposing economic policy conditions that increase inequality.

The coalition of diverse groups from developed and developing countries launched a new campaign 'World Bank our of climate finance' today calling on governments to resist any role for the institution in climate finance. They are particularly angry that in an early draft of the negotiating text, the World Bank has been invited to serve as the interim trustee of a new global climate fund - and potentially its secretariat.

Yesterday morning, there was a march organized by a coalition of groups, including Friends of the Earth, Jubilee South, and the Freedom From Debt Coalition. It kicked off with a rally, featuring speakers from World Bank-affected communities from around the world. They marched and returned to the Municipal Hall to smash piñatas, which they said "represent the World Bank."

The organizers stated "The World Bank and other multilateral development banks must not be given a role in establishing or governing the new Global Climate Fund nor in managing climate finance. Their nature, structure, track record, and policies, stand in contradiction to what should be the principles of fair and effective climate finance, and the structure and operations of a new fund."

"The World Bank, they continued, "is a lending institution that has long been imposing policy conditions and programs on South countries and peoples through its loans. Giving a role to the World Bank in climate finance will result in a significant part of climate finance flowing as loans, and will very likely come with conditionalities,"

This morning, the World Bank organized a panel dedicated to agriculture. The panel advocated agricultural related investments, and focused on policies and programs that would increase farm productivity and incomes. It lobbied for making the sector part of the solution to climate change by sequestering more carbon into soil and business.

Panelists included Vietnamese Minister of Agriculture Cao Duc Phat; US Secretary of Agriculture Tom Vilsack; Norwegian Minister of Environment and Development Erik Solheim; Uruguayan Tabare Aquerre; and UN Food and Agriculture Organization.

World Bank President Zoellick advocated for an integrated approach to agriculture: "We know that we need to increase agricultural production by 70 percent by 2050 to feed nine billion people and that climate changes risk more uncertainty and potentially serious down-side possibilities. Agriculture, forestry and land use," he continued, "change account for more than 30% greenhouse gas emissions. So we need to make the agriculture sector and soil carbon part of the solution to climate change."

This afternoon, a press conference action agitated for "No Climate Debt." Reza Chowdury said, "We do not want the World Bank in climate financing. It will create debt burdens. We do not want to see our children in a debt burden." The march ended in a walkout.

Organizations are increasingly frustrated by how they being silenced at the UN. They have launched a new campaign "World Bank out of Climate Finance", putting pressure on their governments not to impose the World Bank on their communities, particularly in developing countries, in the form of climate finance.

Over two hundred organizations from around the world, including Friends of the Earth International, Jubilee South, and the Pan-African Climate Justice Alliance have signed an open letter sent to all governments today, calling for resistance to the World Bank. They urged that the Global Climate Fund be set up under the authority of the UNFCCC, so that it has an equitable governance structure, prioritizes the participation of affected communities, operates with full transparency and accountability and provides direct access to funding.

So far, the funding mechanisms within the UNFCCC have not been nailed down.

Tina Gerhardt is an independent journalist and academic, who has covered international climate change negotiations, most recently in Copenhagen and Bonn. Her work has appeared in Alternet, Grist, In These Times and The Nation.

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