Swords to Ploughshares

Peter Bosshard
Tuesday, December 3, 2013

The International Development Association (IDA) is the World Bank’s fund for the poorest countries. You could be forgiven for thinking that IDA projects primarily aim to reduce poverty, but this is not the case. In the energy sector, IDA favors a business-as-usual approach of large dams and fossil fuel projects. Such projects frequently impact host communities and the environment but don’t address the needs of the poor. 

International Rivers has launched a campaign to shift international energy finance from the World Bank to an institution that is better placed to reduce poverty in a climate-friendly way.

Activists called for Power 4 People in front of the World Bank during the Bank’s fall meetings in October.
Activists called for Power 4 People in front of the World Bank during the Bank’s fall meetings in October.
Photo: International Rivers

The biggest IDA energy project in the past six years was a transmission line that will export electricity to Kenya from the Gibe III Dam and other destructive hydropower projects in Ethiopia. Other large projects included the Kandadji Dam on the Niger River, which will displace 38,000 poor farmers; the costly rehabilitation of the Inga 1 and 2 dams on the Congo River, and a slew of coal, oil and gas projects. About one third of IDA energy lending supported renewable energy technologies, and only a fraction of those benefited the rural communities that are usually bypassed by national electric grids. 

Governments will meet in Moscow on December 16-17 to negotiate their contributions to the 17th replenishment of the IDA fund. One of the official goals of IDA 17 is “inclusive growth,” and the World Bank has committed to “ensuring that the opportunities and benefits of growth are broadly shared throughout the population, including by expanding economic opportunities for the poorest, women and disadvantaged groups.” 

The lofty rhetoric masks a sober reality. The Bank has already announced that it plans to fund the Inga 3 Dam on the Congo, the Mphanda Nkuwa Dam on the Zambezi and other mega-dams under IDA 17. These dams will serve cities, mining companies and export markets. Making a mockery of the “inclusive growth” motto, neither Inga 3 nor Mphanda Nkuwa are intended to expand access for poor consumers. 

The replenishment of the IDA fund offers an opportunity to use the power of the purse strings, which has often been the language the World Bank understands best. The Power 4 People campaign, which is being coordinated by International Rivers, calls on governments to shift 7% of their contributions – for a total of $1.6 billion – from IDA to the Green Climate Fund for the support of decentralized renewable energy projects. This amount reflects the portion of IDA lending that the World Bank has spent on destructive energy projects in the past six years. 

The Green Climate Fund has been created under the auspices of the UN climate change convention. Its mandate is to support developing countries in mitigating and adapting to climate change within a framework of sustainable development. The fund is better placed than the World Bank to reduce energy poverty and mitigate climate change, to turn energy swords into ploughshares. While NGO networks support the creation of the new fund, they still need to ensure that it adopts strict social and environmental safeguard policies for its operations. 

“Shifting resources from the World Bank to the Green Climate Fund will send a message that the Bank’s big-is-beautiful philosophy is no longer acceptable,” said Sena Alouka, Executive Director of Jeunes Volontaires pour l’Environnement (Togo). “It will also provide additional funding for projects that reduce energy poverty while protecting the climate and local ecosystems at the same time.”

International Rivers has launched an online petition, calling on governments to shift their energy funding from IDA to the Green Climate Fund, from a business-as-usual approach to decentralized renewable solutions for the poor. We will continue to put pressure on the World Bank and its member governments through the Power 4 People campaign in 2014. In the meantime, you can sign the online petition