France and other World Bank shareholders are seeking a solution to maintain climate strategy

Eleonore Caoit, France's development minister, said that World Bank shareholders were looking for a way to "keep alive" the climate change financing strategy of the development lender after it officially expired at the end June.

Caroit said late Thursday that she had been discussing plans for keeping the basic 'benefits' of the World Bank's Climate Change Action Plan at the International Monetary Fund's and World Bank's spring meetings this week in Washington.

"We do not find it acceptable that this current plan has expired, and we are looking for a solution to allow us to continue working in this area," said Caroit. Her formal title is Minister delegate for Francophonie International Partnerships, and French Nationals Abroad.

The Trump administration wants the World Bank to abandon its goal of committing 45% to climate-related projects and instead focus on core development, including a return fossil fuel energy projects.

The U.S. Treasury Department's Scott Bessent welcomed the end of the Climate Change Action Plan this week, calling the World Bank climate targets "distortionary and nonsensical."

Bessent, in a letter to the steering committees of the World Bank and IMF, said that the Bank would immediately change its focus from chasing arbitrary targets to focusing on high-quality and durable projects.

OIL SHOCK His statements were similar a year ago, but this week's intense discussions were prompted by the imminent expiration of his contract and the huge oil and gas supply and price shock caused by war in the Middle East. This is now threatening to?tank the global economy.

Senior development officials at IMF and World Bank Meetings said that allowing action plan to expire would be an "important political signal."

The official spoke under condition of anonymity. "Projects with an obvious, ostensible climate focus, such as solar power, could well be at risk in the future at the (World Bank board)." The World Bank's 19 shareholders signed a letter last October urging continued support for the bank’s climate goals. However, the directors from the U.S.A., Japan India, Saudi Arabia Russia, Kuwait and Saudi Arabia declined to sign.

According to a second source, who is familiar with the World Bank board's deliberations regarding climate change, executive directors representing just under half of the voting power on the board support continuing climate engagement. However it is unclear whether this would translate into the finance minister level or higher.

Ajay Banaga, the World Bank president, who was given a mandate by Biden's administration to increase climate finance quickly and concentrate on renewables last year, ended a nuclear ban and began a push for more gas projects.

In October, he rebranded climate projects as "smart developments" that create jobs and lift people out of poverty and build resilience against droughts.

He stated that 48% of World Bank project financing has climate "co-benefits", and that projects like?flood resistant roads, railways which move goods more efficiently than truck and water-saving drip-irrigation systems counted toward the goal.

Caroit stated that there is still a?strong' demand from developing nations for these types projects, which are considered to be part of the Climate Strategy - no matter how they are labeled - such as wind and solar energy projects as well as projects related to climate adaptation.

"We are talking about adaptation to climate change." She said that we're talking mitigation to limit?its impacts. "We're talking ultimately about improving people's lives, helping them fight against hurricanes and floods. Caroit said that France will advocate for the preservation of 2015 Paris Agreement climate change goals during its Group of Seven Presidency this year. The finance ministers and governors of central banks will meet in Paris from May 18-19. This is ahead of the leaders summit at Evian-les-Bains, which takes place in June. (Reporting and editing by Paul Simao; David Lawder)

(source: Reuters)