Open letter by 35 CSOs urges Bank of China to phase out financing coal projects worldwide; Bank did not respond
Open Letter to Bank of China
In May 2021, 35 civil society organisations from around the world wrote to Bank of China, raising their concerns about Bank of China's financing of coal projects worldwide. According to the letter, Bank of China's coal financing totals more than US$35 billion since the Paris climate agreement was signed in 2015, making the bank the largest coal financier in the world. Bank of China's lack of any public policy that curtails its investments in coal also puts it behind over 130 financial institutions that have already limited their support for fossil fuels in recognition that coal, oil and gas carry significant environmental, reputational and financial risks.
Coal Financing and Community Concerns
According to the open letter, in many instances, coal expansion also destroys local communities' livelihoods. In Bangladesh, thousands of fishermen and farmers have been displaced and not fully compensated for the loss of their homes and farmlands during the land acquisition process for coal power plants. In Vietnam, the resettlement area offered to farmers displaced by a coal power plant is not suitable for farming. In Turkey and Indonesia, coal power plants have polluted farmlands and fishing grounds that villagers depend upon for their livelihood.
As a signatory to the Green Investment Principles, Bank of China is encouraged to incorporate sustainability and ESG factors into its corporate strategies. The signatories also invite Bank of China to immediately develop and disclose a policy that:
- rules out financing new and expansionary thermal coal power and mining projects,
- commits to phasing out financing to the fossil fuel industry in line with the goals of the Paris Agreement, and
- prioritizes the development of clean, renewable energy in a manner that upholds local ecological sustainability and the rights of communities to free, prior and informed consent.
Company Response
In May 2021, the 35 CSOs addressed the letter to Bank of China's Chairman Liu Liange, inviting the bank to respond within two weeks. Bank of China did not respond.
In September 2021, the Business & Human Rights Resource Centre reached out to Bank of China again, inviting the bank to respond to the open letter. Bank of China did not respond.
The 35 civil society organisations are:
- Trend Asia - Indonesia
- 350Africa.org - South Africa
- 350.org - Global
- African Climate Reality Project - South Africa
- Asian Energy Network (AEN) - Philippines
- Asian People’s Movement on Debt and Development (APMDD) - Philippines
- Auriga Nusantara - Indonesia
- Bangladesh Poribesh Andolan (BAPA) - Bangladesh
- Bangladesh Working Group on External Debt (BWGED) - Bangladesh
- BankTrack - The Netherlands
- BINDU Women Development Organization - Bangladesh
- Centre for Environmental Rights - South Africa
- deCOALonize Campaign - Kenya
- Eastern Mediterranean Environment Platform (DAÇE) - Turkey
- Environment and Consumer Protection Association Adana (ÇETKO) - Turkey
- Fossil Free South Africa - South Africa
- Friends of the Earth Japan - Japan
- Fundacja "Rozwój TAK - Odkrywki NIE" - Poland
- Fund Our Future - South Africa
- Kanopi Hijau Indonesia - Indonesia
- Market Forces - Global
- Mekong Watch - Japan
- Pakistan Kissan Rabita Committee - Pakistan
- Pena Masyarakat - Indonesia
- Reclaim Finance - France
- ResponsiBank - Indonesia
- Rural Development Policy Institute - Pakistan
- Save Lamu - Kenya
- Solutions For Our Climate (SFOC) - Republic of Korea (South Korea)
- The Prakarsa - Indonesia
- Trend Asia - Indonesia
- WALHI - Indonesia
- WALHI West Java - Indonesia
- Waterkeepers - Bangladesh
- YouthNet for Climate Justice - Bangladesh