HSBC erase the courageous work done by climate activists in the countries for whom they’ve granted themselves a free pass to continue profiting from the filthiest of fossil fuels.
HSBC stunned the world of climate finance campaigners with their new policy on finance for coal, tar sands and Arctic drilling in April 2018.
We were pleased that Europe’s largest bank seemed to have fully excluded the most carbon intensive fossil fuels from its finance regimen. This came in the same few months that ING and BNP Paribas made similar exclusions, suggesting that the tide of fossil free finance was turning.
However, it became apparent that HSBC - like the fossil fuel companies they finance - are generally more interested in capitalising on climate change and sustainability to bolster their reputations that take serious action. Their coal exclusion makes exception for coal-fired power plants in Bangladesh, Indonesia and Vietnam.
It is evident that HSBC did not pick these three countries out of thin air. They are emerging markets for coal and it would be irresponsible for them to neglect their huge potential profitability.
Regardless of whether the short term viability of our shared climate is at stake, HSBC still has the reckless pursuit of profit as its driving motive devoid of the social and ecological context.
HSBC’s justification cites the relatively low access to electricity in those countries. This is a cynical co-option of the systemic under-development of states in the Global South by the North to justify Northern banks continued financing of a colonial extraction regime driving a climate crisis that will unequivocally affect those very countries and the poorest people in them the most severely.
This month, People & Planet students joined campaigners across Europe calling on banks to respect the IPCC’s warnings of the twelve years we have to keep warming below 12o°C. They told banks that they too are fossil fuel companies as long as they continue to finance climate breakdown, as HSBC do.
In February, People & Planet hosted a webinar with anonymous climate justice organisers from Vietnam. This was two months before HSBC’s policy shift, but even then an organiser told us that HSBC is the leading British bank backing coal projects in Vietnam.
Despite backlash against grassroots social movements, there is an active movement in the country against coal expansion. HSBC erases the courageous work done by climate activists in the countries for whom they’ve granted a free pass to continue profiting from the filthiest of fossil fuels.
Vietnamese organisers told us that their country is low-lying, making it especially vulnerable to rising sea levels. It has the potential to feel climate impacts as intensely as any other country in the world because food production is affected by flooding of crops. They also warned of the risks of air pollution born of new coal industries.
These threats have not discouraged their government from pressing ahead with plans for more and more coal-fired power plants with the financial support of international banks. HSBC is one. Others include banks from South Korea and Japan. 50 percent of finance for Vietnamese coal comes from China.
This underscores the need for systemic shifts in the relationship between finance and fossil fuels globally. They must be decoupled completely.
While the short-term benefits of quick and plentiful finance for the most carbon intensive infrastructure remains available for governments of the Global South, it will surely be irresistible for them as a short-term solution to the economic dispossession and under-development inflicted on them by Northern states and capital.
This is a relationship of exploitation that must be excluded from our global financial system. States in the Global South must not be forced to accept finance for fossil fuels which will further impoverish or make insecure their people.
Fossil fuel finance should simply not be on the table. Instead, finance should be put to work to re-empower the likes of Vietnam, Bangladesh and Indonesia through a global program of decarbonisation.
From the Global North, we can organise for our financial system to change. We should also show practical solidarity with struggles for climate justice in countries that HSBC still sees purely as cash cows.
In the face of a government backlash, Vietnamese organisers called for students and other international campaigners to take action against banks like HSBC; to link up with them by sharing campaign skills and experiences; and demand that our own government and banks withdraw coal finance; and that we use international pressure to encourage the Vietnamese government to lead on the transition to renewables.
Chris Saltmarsh is co-director of climate change campaigns at People & Planet. He tweets at @chris_saltmarsh.