$677 billion a year in investment and subsidies is going to the developed world
Dhaka, September 30, 2024: A new report conducted by ActionAid International revealed that over USD 677 billion in subsidies is being poured into fossil fuel and industrial agriculture sectors annually, fueling greenhouse gas emissions. Developed countries are the primary beneficiaries of these subsidies, which are contributing to global temperature rise and biodiversity loss.
The findings of the survey were revealed at a program organized by ActionAid Bangladesh at a hotel in the capital's Gulshan today (September 30). 'Fund Our Future ', a campaign to prevent climate disasters, was unveiled on the occasion.
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‘How the Finance Flows 2024’, a report conducted by ActionAid International, explains how public funds from the global south are being diverted to fuel the climate crisis, while enriching fossil fuel and industrial agriculture sectors. The research found that between 2016 (when the Paris Agreement was signed) and 2023, the fossil fuel sector received an average of USD 438.6 billion annually in public subsidies from the Global South. The industrial agriculture sector benefited from an average of USD 238 billion per year during the same period.
The report further reveals that renewable energy in the global south is receiving a shockingly low level of public finance, only a fraction of what is being invested in fossil fuels. The shift towards sustainable and green renewable energy is falling behind. Moreover, an increasing number of countries in the global south are now at risk of climate-related debt. The amount of subsidies for fossil fuels is more than 50% of the per capita income of people in the most climate-vulnerable countries in global south.
Farah Kabir, Country Director of ActionAid Bangladesh moderated the panel discussion at the launch of the report. Participants, included representatives from civil society organizations, national and international development agencies, and local environmental and energy experts, discussed the findings.
Panelists emphasized that the climate finance received by countries in the global south, is only a fraction of the subsidies going towards climate-destructive sectors. The adverse impacts of climate change are disproportionately felt by young people, farmers, women, and marginalized communities in the global south. In this context, there is a need to increase investment in sustainable projects and renewable energy, shifting away from fossil fuels. Ahead of COP29, there is a pressing need to agree on a new climate finance goal of $5 trillion per year to address climate loss and damage. This climate finance should be channeled through well-planned and targeted actions.
Farah Kabir, Country Director of ActionAid Bangladesh, said, “This report exposes how fossil fuel and industrial agriculture corporations are driving our climate crisis. We must ensure accountability and transparency. We must demand justice and continue our fight collectively.”
Ahmed Zubaer, Joint Director of Bangladesh Bank said: "We need to think about what are the viable alternatives to green energy. We get funding but the process is a bit complicated. It has to be made easier. We have to focus more on climate adaptation than climate impact mitigation. '
Morshed Millat, former Director of the Sustainability Finance Department, Bangladesh Bank said ‘bringing transparency is more important than using climate funds. The policies in the context of South Asia must be practiced at the field level.’
Anwar Farooq, former Senior Secretary, Ministry of Agriculture, said: "Other sources of renewable energy should be increased to optimize the availability of energy. At the same time, the amount of land is decreasing relative to our population. The green agricultural transition should be accompanied by a plan to maximize the use of land by reducing the use of harmful fertilizers and increasing the use of organic fertilizers. '
Florian Höllen, Counsellor, Head of German Development Cooperation, German Embassy Dhaka, said: ‘Bangladesh's energy sector needs to be restructured. The government should take initiatives on green energy transition in such a way that people show interest in it. And the government can think about how the fossil fuel generating power plants in Bangladesh can be converted into renewable energy. '
Sabbir Hossain, Chief Operating Officer of BRAC Bank, said that ‘80 percent of the solar panels used on the roofs of houses in Dhaka have become ineffective. But it's not being reviewed. Now is the time to reevaluate and plan solar in a new way.’
Ibrahim Khalil Al-Zayad, chairperson of ActionAid International Bangladesh Society, said, ‘There is an opportunity now to make a new inclusive and coordinated policy on energy. We need to increase research on climate change, green energy and renewable energy. We need to find new ways to solve the energy problem.’
The report called for an end to fossil fuel financing, increased investment in renewable energy and sustainable agriculture, and for public funds to be redirected towards climate solutions that protect people's rights to food, energy, and livelihoods. It urged national and regional governments to regulate the banking and finance sectors to stop financing fossil fuel expansion.
Among the attendees at the event were Enamul Karim Pavel, Head of Renewable Energy at Infrastructure Development Company Limited (IDCOL); Syeda Afzalun Nessa, Head of Corporate Sustainability at HSBC; Abul Kalam Azad, Manager, Just Energy Transition Team (JET), ActionAid Bangladesh; Tanzia Anjum, Deputy Manager, Resilience and Climate Justice Team, ActionAid Bangladesh; and representatives from various civil society organizations (CSOs), national and international development organizations, local environmental and energy experts, and economic specialists.
