“Rich Nations Fail to End Support for Foreign Fossil Fuels Before Trump Presidency”

The push to get rich nations to end their export credit support for overseas oil and gas projects before Donald Trump takes over as US president has failed, with opposition from South Korea and Türkiye, and lukewarm support from the United States.

The European Union, UK, Canada, and Norway have been leading efforts to expand a 2021 ban on support for coal to include oil and gas in the Organisation for Economic Co-Operation and Development (OECD). However, negotiations have stalled, with the OECD unable to reach an agreement to further restrict support for fossil fuel-related projects.

Campaigners have expressed disappointment at the lack of progress, particularly before Trump assumes office. The export credit agencies of OECD governments provide about $40 billion in support to foreign fossil fuel projects annually, with the majority going to oil and gas projects.

Opposition to the proposals came from South Korea, Australia, and Türkiye, with the US, Japan, and Switzerland expressing reservations. South Korea argued that the ban would unfairly affect developing countries outside the OECD, while Türkiye and Australia cited concerns about energy security and the pace of the transition away from fossil fuels.

Negotiations intensified after Trump’s election, but talks broke down without an agreement. Critics have pointed fingers at South Korea for hindering global climate ambitions, especially given its role as a leading producer of liquefied natural gas carriers.

While the OECD talks have stalled, climate campaigners are encouraging countries to join the Clean Energy Transition Partnership (CETP), which aims to end overseas support for fossil fuels. The initiative has seen success, with signatories significantly reducing their fossil fuel financing.

Efforts are underway to get South Korea and Japan to join the CETP, particularly amidst political turmoil in Korea. The OECD spokesperson noted that any government is free to adopt more restrictive terms for transactions supporting fossil fuel projects.

Overall, the failure to reach an agreement highlights the challenges in transitioning away from fossil fuels and the importance of international cooperation in addressing climate change.