China’s Banks Asked to Stop Funding Turkey’s Coal Industry

China’s Banks Asked to Stop Funding Turkey’s Coal Industry

(Bloomberg) --

More than 20 non-governmental organizations have called on Chinese banks to withdraw financial support for a coal-fired power plant under construction in Turkey, citing environmental damage and a disregard for the “green” pledge of China’s Belt and Road Initiative.

The groups sent letters to China Development Bank, Bank of China Ltd., and Industrial & Commercial Bank of China Ltd., asking them to halt financing for the Emba Hunutlu project, they said in a press release Tuesday. A related online petition garnered more than 19,000 signatures.

“In light of community opposition to the project, as well as the lack of legal compliance, we respectfully ask that the financiers of the Emba Hunutlu coal plant to withdraw all financial support from the project,” the group said in the letter. “We believe that the cumulative biodiversity, environmental, air pollution, climate, and policy alignment issues raise serious red flags about your institution’s involvement in this project.”

Activists are increasingly targeting international financing for coal projects as a way halt the construction of new plants, which are a major contributor to greenhouse gases. Institutions in China, as well as Japan and Korea, are under sustained pressure for their support of projects, particularly in Southeast and South Asia.

Bank of China declined to comment. The other two banks, as well the project’s developer, Shanghai Electric Power Co., didn’t respond to requests for comment.

The Hunutlu plant, one of China’s largest investments in Turkey, received a 15-year, $1.38 billion loan from the three Chinese banks. Construction on the 1,320-megawatt station started in September and is scheduled to end next year.

The group, which includes Turkish and international NGOs, cited ongoing air pollution issues in Adana province, where the plant will be built, and that the project could result in 2,000 premature deaths. The facility would also be a threat to the nesting area of a protected species of turtle.

All the three banks in April 2019 signed the Belt and Road Green Investment Principles, a set of voluntary guidelines incorporating low-carbon and sustainable development practices for projects along China’s major overseas investment initiative.

A report last year by the Institute of Energy Economics and Financial Analysis, which advocates for the adoption of green power, concluded that Chinese banks are investing in more than one-quarter of coal plants under development outside China, totaling $35.9 billion for 102 gigawatts of capacity in 27 countries.

©2020 Bloomberg L.P.

With assistance from Bloomberg