NGO FORUM ON ADB DEMANDS ADB TO FULFILL PARIS AGREEMENT COMMITMENT

NGO Forum on ADB, a network of over 250 civil society organizations (CSO) around the world calls on the Asian Development Bank (ADB) to fulfill its commitment to the Paris Agreement as the Bangkok Climate Change Conference (UNCCC) 2018 continues.  The network reiterates the question whether ADB will address the climate crisis or continue its business as usual pursuit of economic growth driven by dirty energy?

The current shift in global development financing, specifically in relation to Asia’s developing economies have raised the stake on the governance mechanisms of multilateral banks, particularly given that in the global context, private banking institutions are committing to end or phase out investments in fossil fuels and non-renewables. Likewise, there is a real struggle in holding private investors accountable especially in the realm of development financing. The establishment of fresh lending institutions, such as the Asian Infrastructure Investment Bank (AIIB), New Development Bank (NDB) and the ascension of China as an economic and political superpower seems to signal a new order in the continent’s aid architecture with a push for mega infrastructure investments.

Rayyan Hassan, executive director of NGO Forum on ADB stated that “the Forum is gravely concerned with these seismic shifts in global development financing, specifically in relation to Asia’s developing economies. The intrusion of private capital in mega infrastructure investments, have raised the ante on the governance mechanisms, or lack thereof, of multilateral banks especially the ADB. The network believes this lack of accountability of private capital is a telling sign for all future especially energy intensive projects being championed by the ADB through its Strategy 2030”.

The ADB at present is reviewing its Strategy 2030 and has had made considerable shifts in its lending in the energy sector. ADB has set up a controversial clean technology fund or CTF through which in 2013 it has financed - without meaningful consultation or attention to environmental or social safeguards  - over 150 Million USD in geothermal energy projects in Indonesia alone.  Geothermal technology and gas projects are still riddled with underlying environmental impacts including GHG emissions .

In 2016, the ADB through its ADB CTF Private Sector Geothermal Program: Indonesia & Philippines was attempting to seek further funding, again without the mandatory meaningful public consultation required by the ADB.  In addition, ADB has provided direct support in the name of "clean energy" for the notorious mega-infrastructure Financial Intermediary, PT Sarana Multi Infrastruktur, (PT SMI) with a well-documented track record of violations of environmental and social safeguards. Given that the majority of geothermal projects in Indonesia are targeted at forest areas inhabited by Indigenous and other forest-dependent peoples, lack of attention to the environmental and social impacts is a tremendous problem.

NGO Forum also notes with extraordinary concern that the ADB is currently attempting to place Indonesia's entire National Energy Company (PLN) under "borrower system" rules instead of requiring mandatory implementation of all ADB Safeguards. Given the dismal environmental and social track record of PLN and the borrower system, this call into question any claims of a focus on clean technology with meaningful environmental and social safeguards.

The ADB has also a track record of financings dirty fossil fuel projects such as the Tata Mundra Coal Power Plant in India, Visayas Coal Project in the Philippines, and many other investments in gas projects in the region. At present, ADB is looking to invest in the CHP5 Coal Power Plant in Mongolia. The bank has also sent a team to see the feasibility of the Upper Karnali Hydropower Dam in Nepal as a possible investment venture. In fact, the majority of its 41 energy pipeline projects published online, are based on the extraction of fossil fuels or other forms of retrogressive energy investments, including large hydro and waste to energy (incineration) projects.

The network is asking the ADB to provide a clear plan of action on transitioning from Fossil Fuel energy to fully renewable energy investments and to ensure and publicly commit that these investments - including existing investments as described above -- are carried out under fully implemented ADB safeguards with mandatory meaningful consultation with affected communities, strict avoidance of forced resettlement, and with careful and documented adherence to environmental safeguard requirements, including the protection of forest and forest peoples, and mandatory social safeguards for the protection of the lives and livelihoods of affected communities, with a specific focus on women, Indigenous peoples and the vulnerable as required by ADB safeguards. The transition from Fossil Fuel to RE must have clear indicators and targets with mandatory indicators including gender-disaggregated documentation of environmental and social impacts and the prevention of those impacts, including information disclosure, consultation, avoidance of land evictions.

Lastly, NGO Forum on ADB calls for clean energy transition indicators in line with countries and their respective NDCs (Nationally Determined Contributions) as per the Paris Agreement.(By Jen Derillo Santos)