Japan, China, S Korea bankroll Indonesia's coal despite Paris pledge
Japan, China and South Korea are bankrolling environmentally destructive coal-fired power plants in Indonesia despite their pledges to reduce climate-changing emissions under the Paris climate deal, analysts told the Thomson Reuters Foundation.
Australia-based environmental finance organisation Market Forces said it analysed 22 coal power deals in Indonesia since January 2010 and found state-run financiers for the three nations were involved in 18 of them.
In all, foreign banks, both commercial and state-owned, are providing 98 percent of the debt finance for the projects, amounting to $16.7 billion.
Indonesian banks provided just 2 percent of the financial resources for the projects, according to the Market Forces analysis published this week.
Japan, China and South Korea "are on board with the Paris climate change agreement. They make all the right noises politically," Julien Vincent, executive director of Market Forces, told the Thomson Reuters Foundation in a phone interview. But "these are the same governments underwriting new coal development elsewhere", he said, calling the actions "egregious".
The landmark 2015 Paris Agreement, which came into force in November, seeks to limit the rise in average world temperatures to well below 2 degrees Celsius above preindustrial times.
Coal is the most polluting of the major fossil fuels and scientists say its use must be rapidly phased out to give the world a chance of meeting its goals to curb climate change that is stoking more deadly heatwaves, floods and sea level rise around the world. Indonesia, Southeast Asia's largest economy, is already one of the world's biggest emitters of greenhouse gases.
Market Forces said the Export-Import Bank of China (China Exim) was involved in seven of the coal power deals, the Japan Bank for International Cooperation (JBIC) and the China Development Bank (CDB) in five deals each, and the Korea Development Bank (KDB) in one deal. The Export-Import Bank of Korea (Korea Eximbank) is also involved in one deal, together with JBIC, it said.
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