Government export agency says its provided record levels of sustainable investments to developing countries last year
UK Export Finance (UKEF) doubled its sustainable investments last year after providing £2.4bn of financial support to UK businesses delivering a range of projects that provided a positive social or environmental impact, the government announced today.
The export credit agency said it had chalked up record levels of sustainable investment in developing countries after spending more than £120m on “major energy transformation” initiatives, with key projects including two offshore wind farms in Taiwan and two of Spain’s largest solar power plants, a £27m investment in a pioneering solar powered water sterilisation programme in Ghana, and more than £1.9bn on major transportation projects, including backing for a new electric monorail line in Egypt.
An independent assessment of national export credit agencies published by Trade & Export Finance Limited had found the UK provided the second most export credit support for sustainable projects last year, it said.
Minister for Exports Graham Stuart said the agency had expanded its reach into more markets over the last year. “This major financing of critical work helps to bring prosperity to millions of people around the world,” he said. “We increased UKEF’s capacity to support overseas projects in over 100 markets last year, and its financing has placed UK businesses at the heart of many important global projects as a result.”
UKEF confirmed it now had representatives in Africa, South America, the Middle East, and Asia helping it identify projects with long-term and sustainable growth potential, adding it planned to “significantly increase” this network in 2021.
Stuart emphasised UKEF was committed to helping other countries benefit from efforts in the UK to “build back better” from the ongoing economic and health crises. “Free and open trade, backed by global rules, offers the lowest income countries a better deal,” he said. “As we build back better from the pandemic, we are determined to help developing countries benefit from UK capability and will use our export credit agency, UKEF, to ensure no viable export fails for lack of finance.”
The export credit energy policies have long been heavily orientated towards the fossil fuel sector and it has faced growing calls from campaigner and exporters in recent years to ramp up investments in green energy and clean technologies and end all fossil fuel lending and insurance. A recent report by the Environmental Audit Committee found that between 2013 and 2018, UKEF provided £2.6bn for energy projects in high income countries, and around 96 per cent of this went to fossil fuel exports and only four per cent was provided to finance renewable energy exports and projects.
The government pledged at the end of last year that it would stop all taxpayer support of overseas coal, oil, and gas projects and is currently examining different pathways for how it will end UKEF’s financing of fossil fuels. Campaigners have urged the government to enact this phase out quickly and back away from a number of fossil fuel projects in its pipeline, including £2.5bn of financing for a crude oil pipeline in Tanzania and Uganda.
But today, UKEF emphasised its plans to accelerate its investments in clean energy and technology projects over the coming months and years, pointing to previously-announced plans to provide £2bn of direct lending to support clean growth projects.