China has established a bank that competes with the World Bank. One of the things that this Chinese bank will offer will be loans to third world countries that want to improve the lives of their people by providing them with electricity. The World Bank has banned any loans to these same countries if the country’s means of producing electricity is through the use of coal. The World Bank’s policies are dictated by the US, Japan and the European nations. They have decided that these countries will produce just too much CO2. This is a wrongheaded policy predicated upon the questionable theory of catastrophic man-made global warming.
Obviously there are some seriously hypocritical things about the World Bank policy.
A member of the group dictating policy to the World Bank, Germany, is building new coal based plants, as you read this, to replace nuclear-based electrical plants. By the way, about 30% of Germany’s power is produced by the burning of woody biomass. Not likely to be considered an eco-friendly means of power production. The citing of Germany is not intended to say that they are alone in this activity. Other European nations are building coal-based plants, too.
The NY Times article “ A Call to Look Past Sustainable Development” notes that not just coal is restricted:
“The United States relies on coal, natural gas, hydroelectric and nuclear power for about 95 percent of its electricity, said Todd Moss, from the Center for Global Development. “Yet we place major restrictions on financing all four of these sources of power overseas.”
In that same posting, The New York Times contrasted the power consumption of the per capita of some of these third world countries versus several first world nations as follows:
|Nation||KWH per capita per year|
|Source- 2011 World Bank|
This new bank called the Asian Infrastructure Investment Bank will have China as the biggest shareholder. Although the US asked the World Bank members not to join, Britain, Germany, Australia and South Korea did join. The US has since modified its initial stance saying that the World Bank and the new Chinese bank should work together. I have read that Chinese companies will be awarded most of the contracts for the infrastructure. This may or may not be true.
Should we celebrate the emergence of this new bank? The answer is likely both yes and no. The World Bank’s policy that deprives these third world nations the finances to build power plants using coal or other fossil fuels is just plain wrong. So here I would say “yes.”
But the US financial health relies upon the health of the US dollar (the only real world currency) and this is a shot across the bow by the Chinese. The Chinese and the Russians have been looking for ways to weaken the US dominance it enjoys because of the dollar. And this is first step. So a “no” here.
However, until we get serious about our enormous debt, the dollars preeminence will continue to erode. So if we wish to continue to be the major superpower, we will have to do something about our debt.