The World Bank consistently makes the link between poverty elimination and the need to curb climate change. Yet new WRI analysis shows that of the investments the World Bank financed between 2012 and 2013, only one-quarter addressed climate change risks. We believe the institution must do more to drive and prioritize climate change in all of its activities.
In light of these findings, I caught up with Dr. Karin Kemper, director of climate policy and finance in the World Bank Group’s (WBG) Climate Group. Dr. Kemper shared the Group’s current and future plans to more fully incorporate sustainability—including climate change mitigation and adaptation—into its international development agenda.
WRI: The World Bank Group announced a new strategy in 2013. How does climate change factor into the Bank’s new goals?
Dr. Kemper: The World Bank has been steadily ramping up its climate work over the last year, and the issue is a priority in our new strategy. As you know, the strategy has the twin goals of eliminating extreme poverty and achieving shared prosperity for the bottom 40 percent in all countries. The strategy also says that this should be done in a sustainable manner. Climate change, sustainability, and the concept of caring for future generations – the strategy spans all of these things. President Kim has also highlighted that climate change has the potential to roll back the development gains of the past decades.
In the context of the World Bank Group (WBG) restructuring, there is a newly created Climate Change Vice-Presidency, led by Rachel Kyte. This is a first-such structure for the World Bank. The Climate Change Vice-Presidency is one of five cross-cutting areas that are meant to infuse all operations across the institution. Climate change is the only area that has both a Group Vice-President and a Special Envoy, and Rachel holds both titles. So this significant organizational step follows logically from what is in the new strategy.
Can you give us a preview of some of the new climate-related tools and assessments that the World Bank Group will be rolling out in the coming months?
Our policy that our projects must account for their greenhouse gas emissions came into effect on July 1, 2013. These requirements are to be rolled out and/or developed for three sectors—forestry, energy, transport. The forestry and energy sector assessments are now ongoing. The transport sector assessments are in the process of refining methodologies in order to roll them out by July 1, 2014. We are working to get out GHG accounting for all sectors by July 1, 2016, but let’s consider that an outer target as we may go even faster.
We are committed to addressing climate risk in our work. In December, we had an outstanding fund-raising round for the International Development Association (IDA)—our fund for the poorest countries—where $52 billion was raised from development partners. One major outcome of the agreements that came out of this meeting was that there will be climate screening in all IDA projects starting in July 2014. This means that all new IDA operations will be screened for climate change and disaster risks and, where risks exist, integrate appropriate resilience measures. We know that that there are a lot of different methodologies on how to do this screening, so we recently had a workshop with other multilateral development banks (MDBs) in order to compare notes, see where are others are on this issue, and how to make sure the screening we do benefits countries and eventually harmonizes with policies at other MDBs.
The World Bank Group recently shifted its organization, with the traditional World Bank arms (the International Bank of Reconstruction and Development and the International Development Association) now working more closely with the International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA). How will this shift affect the institution’s response to climate change?
The new Climate Vice-Presidency position brings the World Bank and the IFC under one umbrella. It is a living example of the principle of one World Bank Group being put into practice, and brings great opportunities in the context of climate finance specifically. We know that as we strive to enhance climate finance availability, we need to further leverage the private sector. But the private sector needs an appropriate institutional and regulatory environment in order to perform the way we want.
Of course, this change brings the usual set of challenges. We need to set new directions and be clear about our joint vision. But we found in recent months that the area of climate change is one where you can converge easily. There’s an over-arching goal that everyone works towards, and different pieces of the institution have been contributing to the issue for quite a long time.
What is the role of the World Bank Group in encouraging countries to make decisions with long-term sustainability in mind?
We think that one of the best ways to work with clients is to provide evidence on why climate change matters for them in terms of reaching their goals around reducing poverty and sustainable development. The Turn Down the Heat reports—which warned that we’re on track for a “4 degree world” and highlighted the likely impacts this would have on three vulnerable regions—are examples of where we inject evidence into the international debate. We’re now coming out with region-focused reports, which will provide more information and evidence for why climate change matters at the regional level.
We have a range of ongoing activities and studies. For example, together with the Government of Brazil, we’re providing more evidence that climate change will impact scarce water resources in the northeast part of the country. This is a semi-arid part of the country where, in the 1950s, scores of people died following a major drought. Knowing this and following on four decades of Bank engagement in providing water resource infrastructure in the region, we started to work with the government on climate change analyses. This has informed how we carry out investments in water, agriculture, and the landscape space in northeast Brazil, which is also one of the poorest areas of the country.
What is the role of civil society and communities in curbing climate change in the countries and regions where the World Bank Group operates?
The Bank is seeking more and more to have partnerships at all levels, increasingly at local levels. What communities are rallying around are extreme events. In some countries, they may be used to a certain amount of flooding in certain time period, but suddenly these patterns are becoming erratic. And it is more difficult for poor people to bounce back from these events. The Bank has made major strides in working to have partnerships with civil society organizations and communities in order to better understand development needs.
LEARN MORE: WRI is co-hosting a panel on Friday April 11th during the World Bank/IMF 2014 Spring Meetings Civil Society Program. Our event, Climate Risks and the World Bank, will be held from 2:15 to 3:45 pm, in the World Bank I Building (1850 I Street NW), Room I2-250. Please note you must already be registered to attend. You can also download our full assessment of the World Bank’s portfolio.