UK pulls $1.15bn loan to Mozambique gas project after climate and terror concerns

The Guardian
The Guardian
1w ago • 15 views
The UK government has canceled a $1.15bn loan for a Mozambique gas project due to climate and security concerns. This decision follows criticism over human rights violations linked to the project.
UK pulls $1.15bn loan to Mozambique gas project after climate and terror concerns
A What happened
The UK government has pulled its $1.15bn loan to a liquefied natural gas project in Mozambique, citing concerns over climate change and security risks. This decision comes after years of opposition from environmental activists who argue that the project has exacerbated human rights violations and fueled local terrorism. The project, developed by TotalEnergies, has been on hold since an Islamist insurgency resulted in over 800 deaths in 2021. Business Secretary Peter Kyle stated that the UK Export Finance (Ukef) assessed the project and determined that it no longer served the interests of UK taxpayers. Critics, including Friends of the Earth, have called for a shift towards renewable energy investments in Mozambique, emphasizing the need for sustainable development in the face of climate challenges. The withdrawal of UK support reflects growing recognition of the project's detrimental impacts on local communities and the environment.
★

Key insights

  • 1

    Increased Risks Identified: The UK government found that risks associated with the project have escalated since 2020.

  • 2

    Human Rights Violations: The project has been linked to serious human rights abuses against local communities.

  • 3

    Call for Renewable Energy: Activists urge Mozambique to invest in renewable energy instead of fossil fuels.

  • 4

    International Support Withdrawal: Campaigners are calling on banks to also withdraw support for the controversial project.

Takeaways

The UK’s withdrawal from the Mozambique gas project highlights a significant shift towards prioritizing climate and human rights over fossil fuel investments. This decision may encourage other nations and financial institutions to reconsider their support for similar projects.

Topics

Climate & Environment Climate Change Energy