We are writing to express our collective concerns with the draft text of Asian Development Bank’s Climate Change Action Plan (CCAP), a copy of which has undergone limited circulation but not yet been publicly disclosed on ADB’s website. In this regard, the ADB is now in a laggard position in comparison to other Multilateral Development Banks (MDBs), including the AIIB, which publicly released its Climate Action Plan on 25th September 2023, during its recent Annual Meeting. However, as we understand that the text is still under review, we urge ADB’s management and Board of Executive Directors to take this opportunity to reconsider its provisions and go back to the drawing board to position itself to do no harm in the face of the climate crisis. This would mean first and foremost, ensuring the institution does not continue to approve projects and programs which will exacerbate the climate, biodiversity, ecological, water, food and socio-economic crises within and across the borders of borrowing member countries. Specifically, it is critical for the ADB to proactively screen all current and pipeline financing to sever complicity and partnerships with entities that define their primary business as that of extracting, burning or transporting fossil fuels. It would also mean assuming responsibility for redressing the harm, loss and damage at ADB project sites that are labeled by the Bank as ‘climate finance’ – as well as at the sites of fossil fuel projects that the ADB has helped finance, where community grievances have yet to be resolved.
We would have expected the CCAP – which we understand is intended to guide staff – to read as a plan of decisive action, urgently taking direction from the most recent climate science and evidence from first hand realities of climate-change induced havoc witnessed across the region. Instead, the CCAP is underpinned by a set of business as usual assumptions that call for de-risking and spurring on “new business prospects for the private sector,” with the unstated effect of leaving the public – i.e. those who already face the brunt of the climate crisis – to cope with associated risks, harms and damages. In this regard, a reality check is required, as it is the very same corporations now seeking to benefit from elaborate technocratic schemes, staking claims over planetary commons to earn carbon credits or initiate other market-based schemes, that have been – and continue to be – complicit in exacerbating key inequities and injustices faced by communities across the region.
While the CCAP suggests the ADB is “aligning its financing with the mitigation and adaptation goals of the Paris Agreement, for 100% of sovereign operations and 85% of nonsovereign operations by July 2023, and 100% of nonsovereign operations by July 2025,” (para 10) the explanatory footnote reads that “ADB follows the Joint MDB Alignment Approach to the Paris Agreement, of which ADB is a signatory, and the common MDB assessment methodologies developed as part of that framework”. Importantly however, the MDB joint methodology and principles fail to follow a strict 1.5C trajectory, simply only identifying extraction and burning of coal and peat as “universally not-aligned”. Other MDBs, such as the World Bank, EBRD and AIIB, have all developed and disclosed additional guidance. In fact, the EBRD opened up its draft Paris Alignment methodology for public consultation. However, so far, the ADB has not provided any explanation to demonstrably show how it will step forward to shift its portfolio towards compliance with a 1.5C trajectory, with ambitious targets and indicators, let alone a commitment to end support for fossil fuel related infrastructure, investments and trade financing. Without any such clear and firm guidance, the suggestion in the CCAP that ADB is taking an ambitious approach to Paris Alignment rings hollow.
Whether during ADB’s Annual Meetings, Asia Clean Energy Forums, or policy-related discussions, civil society groups have consistently reiterated the call for ADB to commit to urgently phasing out support for fossil gas infrastructure, stop supporting speculative technologies such as carbon capture and storage/carbon capture, usage and storage (CCS/CCUS), end reliance on fictitious offset arrangements, and avoid continued build-out of large-scale private sector energy, transport, urban, water and agriculture sector projects. Therefore, at a minimum, if the ADB is to genuinely ‘walk the talk’ in averting overshooting global heating thresholds, among the first steps it would take would be to account for the need for a rapid, direct, managed phase out of reliance on fossil fuels. This would require severing of support to expansion of fossil fuel-dependent infrastructure across all sectors, while protecting – not commodifying – planetary commons, and turning away from pinning hopes on the piloting of futuristic techno-fixes or carbon market initiatives.
We also reaffirm our position that MDBs, including the ADB as well as the World Bank, are in no position to take a role in the United Nations Framework Convention on Climate Change’s loss and damage facility. Civil society groups worldwide have resoundingly called for the facility to be independent with a just and democratic decision-making structure providing non-conditional, non-debt creating, accessible, readily available, transparent and accountable support. We urge the ADB to avoid (i) interfering in any aspect of the governance of the facility – which should reflect the inclusive and representative nature of existing multilateral climate frameworks – and (ii) standing in the way of global efforts to ensure financing dispensed is additional, without onerous conditionalities and furthermore tackles the question of climate reparations.
The arena of loss and damage remains one where ADB is yet to ‘walk the talk’ — which would mean assuming and not absolving itself of its own financial responsibility and accountability for addressing harms and providing reparations for damages where its own investments have been complicit in exacerbating climate-related impacts and risks as well as undermining the climate resilience of affected communities. There is no excuse to delay redressing ecological, social and economic harms wrought by current and past projects, including resolving outstanding grievances of project affected communities across the region.
There have been two formal series of online exchanges with civil society and senior staff from ADB’s Climate Change and Sustainable Development Department about the draft CCAP, first in December 2022 and subsequently, in August/September 2023. However, there remains a lack of clear information on how civil society feedback is being taken into account and addressed in the ongoing drafting and revision process.
At the current time, we understand the ADB will be aiming to finalize the CCAP before this year’s UN Climate Change Conference of Parties (COP 28), by November 2023. In the interim, while the text is still being finalized, we affirm that any Climate Change Action Plan fit for the purpose of guiding staff and rooted in the realities of the Asia Pacific region would, at a minimum:
Be underpinned by an approach which clearly and explicitly references international human rights norms and principles, the precautionary principle and polluters’ pay principles as well as the ADB’s own environmental and social safeguards.
Reference and reflect standards incorporated into the latest international agreements on climate, the environment and biodiversity, including for example, the Global Biodiversity Framework.
Acknowledge the importance of environmental human rights defenders to advancing climate ambitions, and the context of lack of safe civic space for such advocates to speak out, making it incumbent upon international institutions such as the ADB to ensure its own consultation processes and grievance redress mechanisms make appropriate provisions to limit risk of retaliation and to react when instances do arise. In addition, the CCAP should incorporate commitments to undertake and integrate reprisal risk assessments, specifically in relation to environmental human rights defenders, into all projects and programs being considered as part of the Bank’s climate-related financing.
Acknowledge that the heavy burden of sovereign debt faced by many countries across the region will only be resolved by unconditional debt cancellation (not conditioned by restrictive swaps negotiated under duress) – including but not limited to public debts incurred for past financing of fossil fuel infrastructure and associated facilities.
Recognize the call for any new public sector-oriented financing to be explicitly non-debt creating.
Exclude reliance on debt for nature / climate swaps – which typically introduce onerous conditionalities, include lengthy technocratic negotiations and complex transactions that exclude affected community representatives and fail to be fully transparent, inherently lead to further commodification of the planetary commons as well as the loss of sovereignty over natural resources, and do not provide the additional, accessible financing that is necessary to urgently fortify climate resilience at local and national levels.
Avoid approaches that prioritize “de-risking investments” for the private sector (which leave the public sector to bear the burden of risk, typically leading to pressures to introduce austerity measures, including the weakening of environmental, labour and social protections).
Acknowledge that not only must a ‘do no harm’ approach be taken in the context of the climate crisis when considering new project-based, technical assistance, bond or equity financing, but that the corollary is also the case, i.e. where harm has been done, redress is required. This includes instances where ADB has supported the expansion of the coal and fossil gas fleet, waste-to-energy incinerators, hydropower projects and large-scale agribusiness, thereby contributing to spikes in GHG emissions, dislocation and negatively impacting communities’ and ecosystems’ climate resilience.
Provide clear, scientifically sound screening criteria based on the timelines and recommendations outlined in the most recent reports of the Intergovernmental Panel on Climate Change (IPCC), UN Environment Program (UNEP) and World Meteorological Organization (WMO) to rule out support for activities that fail to take heed of global heating thresholds and planetary limits, including those which are high GHG emitting or lead to spikes in emissions such as through large-scale land and water use changes. This would require setting up clear, unequivocal standards to avoid supporting carbon lock-in across all sectors, based on time-bound, scientifically sound definitions and methodologies. In addition, calculations and estimations of GHG emissions must be considered comprehensively, incorporating the entirety of the project lifecycle as well as processes associated with project development. Among other aspects, this would include: operation of machinery and project components (such as turbine degassing in hydropower dam projects), impacts on soil and water, waste/debris accumulation and management during project implementation, as well as the processes required for decommissioning.
Exclude “nature based [climate] solutions” that rely on schemes demarcating areas for ‘offsetting’ greenhouse gas emissions, effectively leading to land, water and resource grabbing from local communities, most especially in cases when areas encroach upon ancestral territories of Indigenous Peoples. Meanwhile, carbon market schemes – which are dependent on the speculative trading of carbon credits and lead to further commodification of planetary commons while enabling high GHG emitting industries to continue business as usual – have no place in an equitable and just response to the climate crisis. In addition, we reiterate that it is incumbent upon responsible ADB staff and management to respect and implement provisions to verify whether communities are collectively providing Free, Prior and Informed Consent (FPIC) throughout the course of project cycles (i.e. being conditional, which may be withdrawn at different stages of project implementation).
Account for transboundary implications of projects being developed in border zones and/or intended to provide cross-border connectivity, including in relation to impacts on the climate resilience of ecosystems and communities as well as on shared commons (water, land, air).
Include clear provisions that integrate time-bound methane mitigation pathways.
Note and encourage the highest level of climate ambition already being taken by some member country governments, including Vanuatu, Fiji, Solomon Islands, Tonga, Niue and Timor-Leste, to endorse the Fossil Fuel Non-Proliferation Treaty.
Advance a progressive, proactive approach to alignment with a 1.5C trajectory with no distractions (i.e. IPCC P1 pathway). This would require explicitly excluding financing for CCS/CCUS and similar speculative schemes - which end up diverting finite resources into prolonging dependence on fossil fuels in a range of sectors, and raising risks of negative social, environmental and economic impacts for communities surrounding the associated infrastructure build-out. It would also mean that Nationally Determined Contributions and corresponding National Action Plans should not be used as the sole basis for identifying projects, given they generally follow pathways which will far overshoot the 1.5C threshold.
Commit to ensuring that climate-demarcated sub-projects supported via financial intermediary arrangements as well as investments in trade and global supply chains are i) screened to avoid exposure to coal, oil, gas and petrochemicals (for instance, by cross-checking against the Global Coal Exit List and the Global Oil and Gas Exit List), ii) explicitly required to exclude extractivist industries, including mining, smelting and other ecologically and socially damaging projects such as hydropower and waste-to-energy incineration, as none can be reasonably tagged as contributing to climate mitigation/adaptation, and iii) fully disclosed publicly with timely and specific information regarding the sites/operations receiving financing on ADB’s website. FI sub-projects must also be disclosed at project sites, in a manner and form accessible to local communities, as well as information about the ADB’s accountability mechanism.
Avoid approaches which allocate green and blue finance for public-private partnerships (PPPs), given these typically involve arrangements that undermine respect for internationally recognized labour, environmental and human rights standards.
Screen all FI, blended finance, equity and bond as well as direct financing arrangements to exclude exposure to coal, oil or gas. This would include partnerships with utility companies that have yet to set clear, timebound fossil fuel phase out dates or with consortia that include oil, gas or petrochemical companies.
Commit to ensuring communities affected by projects tagged as part of ADB’s climate mitigation/adaptation portfolio – including via FIs and blended finance arrangements – will be not only fully informed of ADB’s involvement and ways to access ADB’s Accountability Mechanism (i.e. both the problem-solving and compliance review functions), but also are informed of - and can - access channels by which to give substantive input into any climate change, environmental, social and human rights-related risk assessments being done (with corresponding disclosure of information, translated into local languages) to inform project-related decisions and designs from the get-go, grounded in local knowledge and collective awareness.
Ensure that any partnerships with insurance companies on climate-related activities (as explained in the draft CCAP) are conditioned on the requirement that insurers are already implementing a clear coal exit policy and have - or are in the process of adopting – a time-bound oil and gas phase out policy, which aligns with recommendations of the IPCC Sixth Assessment Report.
Avoid bolstering support for schemes which allow coal/other fossil fuel project operators to pull-out of aging or stranded assets with little to no loss and without accountability, and/or to ‘repurpose’ facilities via ‘fuel-switching’ to fossil gas, biomass, refuse-derived fuels, hydrogen, ammonia and other resource and greenhouse gas intensive technologies
Incorporate provisions for plans and preparatory works to be suspended and withdrawn where Indigenous Peoples’ Territories, sacred sites and/or land with ancestral significance to traditional and Indigenous Peoples’ communities, Community Conserved Territories and Areas (ICCAs) or community-based conservation areas may be affected by any of ADB’s climate-demarcated programs, projects or investments, and free, prior, informed consent by affected communities is not obtained. In this regard, we reiterate the critical need for ADB management and staff to respect – in policy and practice – community rights to say no to developments that will impact their lands, territories, resources and/or livelihoods.
Provide clarity on implementation and revision processes – including but not limited to explaining how adjustments will be made in a timely manner to reflect the updates to ADB’s safeguard provisions, explicitly providing assurances of adherence to ADB’s Access to Information Policy and indicating how civil society as well as communities affected by projects/programs being tagged as climate-related financing will be able to engage in – and contribute meaningfully – to future reviews and revisions of provisions.
The above measures – to align with international norms, avoid further complicity in exacerbating climate harm, and steer clear of approaches that undermine and distract from direct, rapid, equitable just transition in the face of the climate crisis – are non-exhaustive, instead being reflective of key concerns based on our understanding of the current status of the CCAP text.
In closing, we look forward to hearing how the revision process proceeds, having clarity on how civil society concerns will be addressed in an updated version, seeing the disclosed action plan posted on the ADB’s website, and receiving information on the process as well as timeline for future revisions.
Co-signed by the following organizations:
350.org Asia | Regional
350 Pilipiias | Philippines
Accountability Counsel | International
Aksi! for gender, social, and ecological justice | Indonesia
Asian Peoples’ Movement on Debt and Development | Regional
Bangladesh Working Group on External Debt (BWGED) | Bangladesh
Bank Climate Advocates | USA
Bomenstichting Achterhoek | Netherlands
Building and Wood Workers International | International
Center for Energy, Ecology and Development | Philippines
Centre for Environmental Justice | Sri Lanka
CLEAN (Coastal Livelihood and Environmental Action Network) | Bangladesh
EarthRights International | International
Freedom from Debt Coalition | Philippines
Friends of the Earth Japan | Japan
Gender Action | International
Global Alliance for Incinerator Alternatives-Asia Pacific | Regional
Global Forest Coalition | International
Green Alternative | Georgia
Growthwatch | India
Inclusive Development International | International
Indigenous Women Legal Awareness Group (INWOLAG) | Nepal
Indus Consortium | Pakistan
Initiative for Right View | Bangladesh
International Accountability Project | International
KRuHA | Indonesia
Life Haven Center for Independent Living | Philippines
Mekong Watch | Japan
Nash Vek Public Foundation | Kyrgyzstan
NGO Forum on ADB | Regional
OT Watch | Mongolia
PACOS Trust | Malaysia
Pakistan Fisherfolk Forum | Pakistan
Participatory Research & Action Network (PRAAN) | Bangladesh
Philippine Movement for Climate Justice | Philippines
Recourse | International
Rivers without Boundaries Coalition | Regional
Rivers without Borders - Mongolia | Mongolia
Save Sual Movement (SSM) | Philippines
Trend Asia | Indonesia
Urgewald | Germany
WALHI | Indonesia
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