Developing country groups slam UK’s climate loans

Groups from 13 developing countries have today slammed UK climate loans, set to be agreed in South Africa this week. The loans are to be given through the World Bank.

Community leaders in countries including Nepal, Bangladesh, Mozambique and Yemen have written to British cabinet ministers Chris Huhne and Andrew Mitchell rejecting the loans the UK is providing to their countries to help them cope with climate change.

In their letter they say the UK and other rich industrialised countries, who have done the most to cause climate change, owe a ‘climate debt’ to poor countries who are worst affected by the phenomenon. ‘Climate loans will only lock our countries into further debt, and further impoverish our people,’ reads the letter.

New research from the World Development Movement and Jubilee Debt Campaign reveals that the UK’s climate funding is pushing the world’s poorest countries deeper into debt.  Their report, ‘Climate Loan Sharks’, also condemns the World Bank for imposing its own priorities on countries receiving climate loans, and ignoring national priorities.[1]

The World Development Movement’s director Deborah Doane said today:

The giving of climate loans rather than grants is contrary to both Conservative and Liberal Democrat party policy. Yet the UK government is supporting loans of $1.1 billion to some of the poorest countries in the world, such as Cambodia, Mozambique and Zambia, for these countries to deal with the impacts of climate change, a problem industrialised nations are largely responsible for."

Saddling countries like Zambia with climate loans is like driving your car into the house of the low-income family next door, and then lending them money to pay for the damage.”

Lidy Nacpil, an anti-debt campaigner from the Philippines, said:

People from developing countries are not responsible for climate change, but we are bearing the brunt of its impacts. Floods, droughts and disease are destroying peoples’ lives. The UK’s policy of pushing World Bank loans on countries already burdened with debt, instead of paying compensation for the damages it has caused, is completely unjust and irresponsible."

Nick Dearden, director of Jubilee Debt Campaign, said:

Unjust debts have increased poverty and inequality across the world. Giving loans to countries to cope with the damage we have caused is morally indefensible. Developing countries are being made to pay twice. Firstly through the impact of climate change, and secondly by paying off these loans.”

The anti-poverty groups have supported the call by the international campaigners who have written to the government, for the UK to pay its climate debt to developing countries in grants not loans, and for its climate funds to be channelled through the UN and not the World Bank.

Protest and photo call: Campaigners in chains will protest outside the Department for International Development (DfID) in London tomorrow. They will highlight the $1.1 billion new climate debt, and hold placards reading ‘No new debt’ and ‘No climate loans’.

Where: DfID, 1 Palace Street, London SW1E 5HE

When: Tuesday 28 June, 8.30-9.30am

For more information, call Miriam Ross on (+44) (0)20 7820 4913, (+44) (0)7711 875 345 or email miriam.ross@wdm.org.uk

Notes to editors

[1] In Nepal, the World Bank overruled the Nepalese government’s own plans for what its climate loan should be used for.

In Mozambique, the World Bank listed civil society groups whom it claimed it had consulted about use of a climate loan, but the groups, when asked, were unaware of the loan programme.

Grenada’s debt is already 90 per cent of its GDP, yet it is to be lent a further $22 million through the World Bank for climate change adaptation, over 3 per cent of GDP.