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Christine Lagarde must change course to a green coronavirus recovery

(Climate Home News, 10 Dec 2020) In the midst of the chaotic unpredictability of 2020, many institutions have found themselves tearing up the rule book and acting in ways that would have been previously unthinkable. Best laid plans have fallen by the wayside, and new approaches have had to be worked out spontaneously.

Central banks are a prime example. The European Central Bank (ECB), Bank of England, US Federal Reserve and others have been pumping almost unimaginable amounts of money into the economy to prevent economic collapse. Some of that money will have done a great deal of good. Some of it though, has gone to industries that are driving us all to destruction. By choosing to back fossil fuel companies and other high polluting sectors, central banks are fuelling one major crisis while trying to fix another. 

Despite leading figures such as the ECB’s Christine Lagarde repeatedly speaking out about the need for central banks to do more to help address climate breakdown, research has shown asset purchase programmes are biased towards high polluting sectors such as the fossil fuel industry. Polluters like Total and Shell are direct beneficiariesof Lagarde’s Covid recovery funding – it is likely that more than €100 billion of ECB money will go to the most polluting sectors and finance their destructive projects around the world.

Given the need for an urgent response in the spring of this year, it is perhaps unsurprising that some bad decisions were made then. What is harder to accept is that those same mistakes are still being made now, when there has been ample time – and widespread public pressure – to correct the course.

Nick Bryer is a campaigner for 350.org based in the UK, working to end finance flows to fossil fuels and to accelerate the transition to a just and sustainable future.

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Climate Home News, 10 Dec 2020: Christine Lagarde must change course to a green coronavirus recovery