On Tuesday at the One Planet Summit, the World Bank Group announced that, as of 2019, it will no longer finance exploration for and production of oil and gas, citing the “rapidly changing world” as its reason.
The Summit, organised by the UN and WBG, brought together local, regional and national leaders from around the world, along with public and private finance entities to identify ways to speed up global efforts to tackle climate change.
In 2015, the bank previously vowed to have 28 percent of its portfolio dedicated to climate action by 2020. The bank’s latest statement on fossil fuel financing suggests that it is on course to achieve that goal.
— World Bank (@WorldBank) December 12, 2017
The Paris agreement is a major factor in the decision. The One Earth summit was planned on the two-year anniversary of the agreement, which seemed uncertain after President Trump, one of the major financial and influential members, decided to withdraw. With the United States being a massive stakeholder in oil and gas production, as well as climate change as a whole, this was a major blow to the environment.
WBG’s announcement brings some hope for a future of renewable energy, and eventually the abolition of oil and gas exploration and production, though we’re decades away from that.
WBG also said that it will make exceptions for the poorest countries where energy access is still needed. However, the World Bank has historically used its neoliberal policies — such as SAPs (Structural Adjustment Programs) — along with the International Monetary Fund to exploit poorer countries and force them further into austerity, so this may not actually bring much benefit to them.