On the vigil of the the start of the COP28 in Dubai and a few weeks before the Italy-Africa Summit, ActionAid Italy, Focsiv, Laudato Si’ Movement, ReCommon, WWF Italy – supported by 29 African civil society organizations – urge the Italian government to commit to stopping international public financing of fossil fuel projects. This must be done from improving the policies of SACE and Cassa Depositi e Prestiti (CDP) implementing the Glasgow Declaration, as well as increasing the spending capacity of multilateral development banks for a zero-emission energy transition and addressing the debt crisis of low-income countries.
In November 2021, at the Glasgow Climate Conference (COP26), 34 countries and five public financial institutions joined the so-called “Glasgow Statement”, a commitment to end new international public financing for coal, oil and gas extraction, transport and processing projects by 31 December 2022. Italy – which shared the presidency of COP26 with the United Kingdom – also joined the initiative. The Glasgow Statement concerns public finance institutions: export credit agencies such as SACE and national development banks such as Cassa Depositi e Prestiti.
Through SACE’s operations, Italy is the largest public financier of fossil fuels in Europe and the sixth largest globally. Since the Paris Agreement came into force, guarantees for coal, oil and gas projects have amounted to EUR 15.1 billion. 42% of these operations concern projects in various countries in Africa: Mozambique, Nigeria, Egypt, etc. During the same period, CDP loans to oil and gas projects on the continent amounted to EUR 1.66 billion.
Frequently, multinational corporations that lead fossil fuel projects and, consequently, export credit agencies and development banks that support them financially, are inserted in contexts marked by strong socio-political instability and human rights violations. These events often took place in Africa: even the recent report commissioned by the French oil major TotalEnergies highlights the complex human rights situation in the area of Cabo Delgado, Mozambique, where the majority of the country’s gas projects are located.
Moreover, future investments in hydrocarbon production in Africa – especially gas – will have no major impact on Italy’s energy security. Even with the end of Russian gas supplies, Italy would already have the necessary infrastructure for its energy security, and would therefore not need to resort to new investments in infrastructure or gas fields.
The proliferation of oil and gas projects stands in the way of a just energy transition on the continent, as denounced by African civil society organizations gathered in September in Nairobi, Kenya, for the Africa Climate Summit. The heads of government of African countries themselves affirmed the need to abolish all subsidies to fossil fuels and to create a new financial infrastructure, also capable of taking into account the restructuring of debt, often contracted by countries precisely to host fossil fuel projects. These words were also echoed recently by the Symposium of the Bishops’ Conferences of Africa and Madagascar, affirming the need to listen to “the plight of the earth and of the most vulnerable by phasing out fossil fuels”.
For all these reasons, in addition to calling for an immediate halt to international public financing of fossil fuel projects in favour of only environmentally, socially and economically sustainable investments, the organizations urge the government to commit to a reform of the international financial system and to plan to reach at least 0.7 per cent of gross national income for official development assistance. A reform that puts all countries in a position to have access to adequate volumes of capital for a zero-emission energy transition and for the resilience of economies against growing climate impacts.
Anabela Lemos, Director of Justiça Ambiental JA!/Friends of the Earth Mozambique and Silver Rose Award for a Just Transition, said: «By continuing to invest in fossil fuel exploration, we will increase emissions and move away from any solution to solve climate change. Since gas exploration began in Mozambique, all we see is an increase in human rights violations, the destruction of livelihoods and community structures, increased poverty and an insurgency that has killed more than 3.000 people and displaced about one million».
Samuel Okulony, Chief Executive Officer at Environment Governance Institute Uganda, said: «For decades, public finance institutions such as export credit agencies has been providing billions of dollars in support for fossil fuel projects abroad, detrimentally affecting local communities, particularly in Africa. While the COP26 declaration provided a glimmer of hope, with countries pledging to cease export support for fossil fuels, some nations have failed to uphold their commitments. Italy is among those and, by ignoring the science and pleas of affected communities who are left to shoulder the burdens of environmental damage, lost farmlands, and the escalating impacts of climate change on their daily lives».
Simone Ogno, Finance and Climate Campaigner at ReCommon, said: «The effects of climate change are with us, at any latitude. We have also seen this with the recent flooding in Campi Bisenzio, Tuscany. The time has come for the Italian government, through its public finance institutions, to do its part, starting with stopping international public financing for fossil fuel projects. This is a unique opportunity to direct public money towards mitigation and adaptation policies in Italy, and to create equal partnerships with low-income countries – starting with those in Africa».
Cristiano Maugeri, Policy Officer at ActionAid Italy, said «European banks continue to finance projects that are highly impactful on the environment. Yet there is no shortage of opportunities to make “financial flows consistent with a pathway towards to low greenhouse gas emissions and climate resilient development”, as the Paris Agreement states in Article 2. The Human Rights and Environment Directive (CSDD), whose path to approval is coming to an end, represents a historic opportunity. We call on the Italian government to ensure that finance remains within the scope of the directive».