News / 23 December 2009

Europe's climate ambitions not consistent with EIB investments

Both ENDS organised a Political Cafe in The Hague on Friday, 20 November in anticipation of the climate summit in Copenhagen. Here, Both ENDS and its Southern partners, GAMBA and NAPE took an in-depth look at the European Investment Bank's (EIB) investments. To what extent do they take the impacts of climate change into account? And, how consistent is their climate policy compared with the ambitions that the EU has for Copenhagen?


Panel members, Thijs Berman (EU Parliamentarian PvdA) and Bruce Rich (author of Foreclosing the Future - Coal, Climate and International Public Finance) stressed the lack of coherence between EU aspirations and -climate policy and the EIB's investment behaviour. They also emphasised the lack of transparency of EIB, a public institution.

It also became apparent that there are conflicting views on the definition of sustainable renewable energy. Because, as Frank Muramuzi (Director of GAMBA, a Ugandan environmental organisation) suggested, how could the controversial Bujagali dam in the Nile be considered a sustainable investment? And, added Renato Cunha (of GAMBA, from Brazil) how it possible that the EIB has invested 110 million euros in the energy guzzling paper mill, Veracel, in his country, while most environmental permits for this plant were illegally obtained?

The Bujagali dam in Uganda, for which the EIB issued a loan of 92 million euros in 2008, will yield less electricity than planned, partly due to climate change and partly due to reduced water levels in Lake Victoria. Part of the local population has been forced to leave their land and see their source of income evaporate. In Brazil, people also had to give up their farmland to make way for the arrival of a paper mill and its Eucalyptus plantation. Both investment projects have been captured on film (a collaboration of Both ENDS and Lokaalmondiaal), and were shown during the debate.

Policy makers, academics, officials from the Ministry of Finance and Agriculture, NGO staff, students and other interested parties also took an active part in the Political Cafe.

The European Investment Bank was conspicuously absent at the debate. This public financial institution claimed to be unable to accept Both ENDS' invitation to participate in the debate. But they did give a very general response to the Policy Note. The EIB was also absent at the international conference which took place just days before at the EU parliament in Brussels. This meeting was organised by Counter Balance, the EIB's watchdog, in which Both ENDS also participates.

EU Member States, like the Netherlands, annually invest billions of euros in environmentally unfriendly industries such as oil, gas, mining, big dams and transport through the European Investment Bank. Many major investment projects are responsible for making the local population even more vulnerable to climate change. In order for it to play a constructive role in reducing climate change, the policies of public institutions like the EIB must be made coherent with European climate policy. Both ENDS sees this Political Climate Café as an important step in lobbying the Dutch government, the EU Parliament and the EIB.

• Download the Both ENDS Policy Note 'Are capital flows from Europe climate proof?'
• See the Both ENDS &lokaalmondiaal films about Bujagali and Veracel (projects financed by the EIB)
• Take a look at Both ENDS' climate change projects: ADAPTS and the European Investment Bank: Counter Balance.
• Read the blog: Both ENDS at the climate summit in Copenhagen - what's up?

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