The World Bank, which provides developing countries about US$60 billion a year in financial assistance, is officially phasing out its support for the oil and gas industries. This move brings its actions more in sync with its overarching commitment to slowing the pace of climate change and keeping the Paris agreement on track. Based on my research regarding international relations, I see this move – which World Bank President Jim Yong Kim announced in December – as significant for two reasons.

Kim has been taking the World Bank in a direction that climate change activists and other critics have long advocated by positioning the institution as a global environmental leader since he became its president in 2012. In 2013, the bank decided to stop financing the construction of coal-fired power plants, except in cases where no viable alternatives existed. Three years later, the World Bank pledged that it would make 28 percent of all of its transactions by 2020 advance climate action.

But the World Bank Group’s two private sector arms, the International Finance Corp. and the Multilateral Investment Guarantee Agency, have continued to support new fossil fuel ventures, including coal, in African and Asian countries – and elsewhere.

For an institution whose mission seeks a “world free of poverty,” the impulse to continue lending for fossil fuel projects could be strong. Recent experience with coal suggests that while the bank’s direct lending indeed may end in all but isolated cases, its indirect support for private sector investment may continue.

Read the full article about the World Bank and fossil fuels by Jason Kirk at The Conversation.