Economy
High street banks’ coal investments linked to destruction of Borneo rainforests
Some of the UK’s biggest banks have come under fire for funding the Indonesian coal boom, which campaigners say is damaging the environment and threatening the lives of communities in Borneo.
A new report by the World Development Movement (WDM) reveals that HSBC, Barclays, Standard Chartered, the Royal Bank of Scotland and Lloyds have lent more money than banks from other countries to Indonesian coal firms. It says that 83% of coal extracted in Borneo is mined by companies partly funded by UK banks.
According to the campaign group, Standard Chartered loaned £640m to Borneo Lumbung, responsible for polluting a river near the Maruwei village, which supplied drinking water to nearby residents.
Barclays is also accused of lending £127m to the largest Indonesian coal mine, partly owned by Bumi plc, which was accused of displacing indigenous communities.
Alex Scrivener, WDM campaigner, said, “The coal boom is leaving a trail of destruction across Indonesian Borneo, wrecking the rainforest and wrecking people’s lives. Here as in so many fossil fuel projects across the world, the invisible hand of UK finance is at work.”
Campaigners say that in addition to damaging the fragile environment in Borneo and disrupting the lives of people in the region, UK banks are also ignoring the recommendations by the Intergovernmental Panel on Climate Change (IPCC). In its latest report, the IPCC warned of an increase in greenhouse gases, largely from the burning of fossil fuels.
“We have to stop our banks pouring billions into dirty energy that fuels climate change and ruins local people’s environments and livelihoods”, Scrivener added.
“And we have to stop destructive fossil fuel companies accessing UK investors’ money by listing on the London Stock Exchange.”
Further reading:
Investors call for genocide-free financial services
World Bank announces plans to phase out investment in coal
IPCC climate report: global temperatures likely to exceed 2C this century
Friends of the Earth study links UK banks with land grabbing