Investing in a Sustainable Future: Multilateral Development Banks' Investment in Energy Policy

By Smita Nakhooda, Athena R. Ballasteros on December 7, 2009
International support for energy sector reform seems to be a promising area for achieving both domestic development goals and internationally desirable greenhouse gas mitigation. This paper analyzes the extent to which current and historical lending by multilateral development banks has managed to exploit this potential. It develops a framework for assessing the extent to which international financial institution (IFI) lending is fostering sustainable development in energy policy, and applies it to lending by the World Bank, the Asian Development Bank and the Inter-American Development Bank, with results that indicate a gap in practice. But the results also indicate that good practice is possible, and indeed is often ongoing. The analysis of the results discusses the ways IFI support can be made to help combat climate change, energy poverty and a host of aligned objectives at the same time.

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IISD, WRI, 2009