Global Witness lodges complaint with OECD over export credit agency's continuing support for fossil fuel projects
The UK's export credit agency was today accused of breaching OECD guidelines governing multinational organisations, with campaigners accusing the government of "rank hypocrisy".
NGO Global Witness has lodged a complaint with the Paris-based OECD, which provides guidelines for how industrialised economies should respond to the climate crisis.
The complaint alleges that UKEF has breached guidelines for multinational enterprises by failing to adequately consider climate-related risks and report on its greenhouse gas emissions. It also alleges that the agency has no targets to reduce emissions.
The OECD cannot compel enterprises to develop a climate risk strategy, but it can publicly state that its guidelines have been broken.
The complaint, which is the first of its kind to be levelled against an export credit agency, will see UKEF enter into an arbitration process mediated by the OECD.
Adam McGibbon, a senior campaigner at Global Witness, said the UK government did have "a clean energy story to tell, but the government nullifies all that good work by spending billions of taxpayers' money abroad propping up fossil fuel projects".
He added that funding of fossil fuel projects overseas "continues to show this government to be climate hypocrites".
The government has taken a number of recent steps to bolster UKEF's green credentials. Last week the Budget included a pledge to provide £2bn of credit finance to overseas 'clean growth' projects, while in January Prime Minister Boris Johnson confirmed that the agency would no longer support coal projects.
But critics maintain that while the agency has already backed away from coal financing, overall support for fossil fuel projects has risen in recent years, with UKEF offering financial support worth £2bn to overseas fossil fuel projects in 2018.
Last year the Environmental Audit Committee issued a strongly-worded report calling on the government to end fossil fuel financing overseas. The report found UKEF spent £2.6bn in recent years supporting the UK's global energy exports, with £2.5bn awarded to fossil fuel projects and just £104m going to renewable energy projects.
A government spokesperson said UKEF would consider its response to the complaint, but suggested the government would contest the allegations.
"UKEF is an export credit agency in the form of a UK government department, and follows the relevant OECD rules," they said. "UKEF does not consider itself a 'multinational enterprise' under the OECD definition."
However, Global Witness maintains OECD's definition of a multinational enterprise is broad enough to cover credit export finance agencies. The FT noted that in 2015, the OECD's national contact point in the Netherlands said the country's credit agency was subject to the think tank's guidelines.
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