The undersigned environmental and human rights civil society organizations (NGOS), led by the Environment Governance Institute, reached out to the 30th Afreximbank Annual General Meeting, held from 18th to 21st June 2023, to address a matter of utmost importance: environmental sustainability and the crucial role financial institutions play in tackling the climate crisis in Africa.
During the AGM, the NGOs emphasized the urgent need for stronger environmental commitments and actions within the financial sector. The impacts of climate change are increasingly evident across the continent, disproportionately affecting vulnerable communities and ecosystems. Despite this, financial institutions like Afreximbank have continued to invest in the expansion of fossil fuel projects, thereby exacerbating the climate emergency. This concerning trend has raised significant alarm.
- In 2021, Afreximbank approved US$1.04 billion for petroleum exploration activities by the Nigerian National Petroleum Corporation (NNPC). This decision faced strong opposition from civil society organizations and local communities due to serious environmental concerns.
- In July 2022, Afreximbank signed a project preparation facility financing agreement to advance the floating liquefied natural gas project in Nigeria, with a capacity of 1.2 million metric tons per annum. The NGOs stressed that this project contradicts the commitments made during COP26, as it promotes the use of gas, which remains a significant contributor to greenhouse gas emissions and is not considered a transition fuel.
- In October 2022, Afreximbank signed a US$635 million reserve-based facility term sheet with Amni International Petroleum Development Company. This funding aims to support the capital expenditure required for two oil and gas fields in Nigeria, with the goal of doubling oil production. Such projects have socioeconomic impacts, including land grabbing, displacement, loss of livelihoods, increased poverty, and gender-related issues such as teenage pregnancies and gender-based violence. Local conflicts, militarization, and growing instability have also been observed, highlighting the adverse consequences of these projects.
- In August 2020, Afreximbank committed US$400 million to the Mozambique LNG project. This project has been linked to extreme violence in the province of Cabo Delgado. Additionally, it will not increase energy access for communities but instead escalate human rights violations and greenhouse gas emissions.
- In October 2022, Afreximbank approved $200 million towards the financing of the East African Crude Oil Pipeline. This pipeline has been highly controversial due to its environmental and social impacts, as well as its contribution to the climate change emergency.
The environmental impacts resulting from these projects have equally affected communities in and around the project areas. Land and water pollution, biodiversity loss, and disruption of vital ecosystems are among the damaging consequences. Such environmental degradation directly undermines progress towards achieving the Sustainable Development Goals (SDGs), particularly SDGs 1, 5, 8, 10, 14, 15, and 16.
The NGOs firmly believe that financial institutions like Afreximbank have a significant responsibility to support sustainable development and contribute to climate change mitigation. Therefore, they urge Afreximbank, in alignment with other governments worldwide that signed the COP26 Statement on International Public Support for the Clean, to immediately halt all projects that harm the environment in Africa. Immediate attention and action are needed to address these pressing concerns and prioritize environmental conservation and human rights observance.