“China Is Virtually Alone in Backing Africa’s Coal Projects”, 7 May 2020

For more than two decades, Zimbabwe has been trying to break ground on a giant coal-power complex by the world’s biggest man-made reservoir. China just agreed to get the $4.2 billion project underway…

But it flies in the face of a growing global consensus that has seen financial institutions from Japan to the U.S. and Europe shun investments in coal projects. That retreat leaves the way open for Chinese companies—many with state backing—even at the risk of undermining the spirit of China’s international commitments to fight climate change.

“We are very pleased that the project is going ahead, especially as major banks in the world are forced to stop financing coal-fired power stations,” Caleb Dengu, chairman of RioZim Energy, the company that owns the project, said in a response to questions. “This is testimony of Chinese commitment to development projects in Africa. The Chinese are interested in joining hands.”…

In fact, the Chinese government promised back in 2017 to green its Belt and Road Initiative overseas construction plan to promote environment-friendly development in line with United Nations goals. President Xi Jinping pledged last year that the program must be green and sustainable.

Yet Chinese companies and banks are involved in financing at least 13 coal projects across the continent with another nine in the pipeline, according to data compiled by Greenpeace. Since 2000, the China Development Bank and the Export-Import Bank of China alone have supplied $51.8 billion of finance for coal projects globally, according to the Boston University Global Development Policy Center.

“Despite promises to shift support to green and low-carbon energy, Chinese banks have continued to bankroll coal power projects,” said Lauri Myllyvirta, lead analyst for the Centre for Energy Research and Clean Air, an independent research body…

Power Construction Corp. of China, the state-owned company known as PowerChina, has been contracted to build the first phase of the plant known as Sengwa… Funding is likely to come from Industrial & Commercial Bank of China, while China Export and Credit Insurance Corp., or Sinosure, may provide the country risk cover needed, according to Dengu…

Repeated calls to ICBC and Sinosure went unanswered. PowerChina said that its overseas coal-related projects will adopt the most efficient technologies to reduce pollution emissions, and will abide by local environmental regulations and standards while aiming to provide stable and cheap electricity supply for host countries.

Last month a deal was signed for the rest of the project, which will add a further 2,100 megawatts at a cost of $3 billion. China Gezhouba Group, which is partly state-owned, will develop the project and lead fund raising, Dengu said. The company didn’t respond to calls and an email request for comment…

As banks in other countries including Japan and South Korea snub coal, those projects will increasingly rely on China…

[Also referred to Rio Tinto Group, RioZim Ltd, General Electric Co., Blackstone Group LP, Morgan Stanley and Citigroup Inc.]