March 12, 2021 Read More →

China and Japan pouring billions into coal projects

SciDev.net:

Japan and China remain among the world’s top coal industry lenders and underwriters, says a report. This despite both countries declaring intent to go carbon-neutral as part of their commitments to climate target set out in the Paris Agreement.

According to the study, the top financiers and investors behind the global coal industry (between October 2018 to October 2020) provided loans amounting to US$315 billion with the top three being Japanese — Mizuho (US$22 billion), Sumitomo Mitsui Banking Corporation (US$21 billion) and Mitsubishi UFJ Financial Group (US$18 billion).

China, although accounting for less than six per cent of total lending to the coal industry, is responsible for 58 per cent of underwriting with Chinese banks channelling US$467 billion to the coal industry in the past two years.

“Japan’s position as a major investor in, and lender to, coal comes as no surprise. Japan has historically been a key enabler of its own coal-fired power technology in developing nations around Asia via public finance support from the Japan Bank for International Cooperation (JBIC) and Japan International Cooperation Agency (JICA),” says Simon Nicholas, energy finance analyst at the Institute for Energy Economics and Financial Analysis.

“The financial support from JBIC in particular underpinned coal loans from Japanese commercial banks,” says Nicholas, adding that JICA is considering funding Matarbari 2, a coal-fired power plant in Bangladesh, years after it financed the construction of Matarbari 1. 

[Melanie Sison]

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