Throughout the world, journalists and policymakers argued over whether it is more important to promote economic development or prevent climate change. The project’s supporters argued that  environmentalists were being anti-development, and that the power plant would bolster South Africa’s economy and create jobs. The project’s opponents—climate change activists and local community leaders—argued that the project would triple the greenhouse gas emissions of South Africa’s energy sector, contribute to South Africa’s water scarcity crisis, and impose heavy costs on some of the country’s most impoverished people. They argued that the water and land surrounding the power plant and its 40 coal mines would become heavily polluted.

Nevertheless, the project is going forward, and the campaign against it continues. In 2012, when government leaders gather in Rio de Janeiro, they will announce a new declaration that sets ambitious goals for achieving sustainable development. Whatever goals are agreed, the declaration will require large amounts of financing to implement. Where this financing comes from and how it is used will become important institutional questions. The international financial institutions (IFIs)—such as the World Bank—will play a key role in financing the new sustainable development agenda. Yet at the same time, the IFIs face constraints that limit their ability to promote sustainable development.

This paper identifies some of the challenges that governments may need to consider as IFIs begin to support the implementation of the Rio+20 declaration.

For the whole article, see attached pdf.

Attachments:

Herbertsen_Greening the international financial Institutions.pdf