How Coal Finance is Flowing through the IFC’s Paris Alignment Loopholes

The report argues that the IFC continues to support coal development in Asia by investing in financial intermediaries, most notably the Postal Savings Bank of China. This mechanism allows the IFC to bypass its public commitments to halt coal financing, resulting in indirect support for 68.3 GW of coal-fired power capacity across China, Indonesia, and Cambodia. The document highlights the Jambi 2 project in Indonesia as a primary example of this 'loophole,' detailing the environmental and health impacts of coal mining and power generation on local communities in Jambi province.

• The IFC is indirectly exposed to 68.3 GW of coal-fired power capacity across 39 projects in China, Indonesia, and Cambodia, comprising plants that have become operational since 2019, those under construction, or planned projects.
• The Postal Savings Bank of China is the largest financier of coal developers within the IFC's portfolio, having provided 418 billion RMB (approximately $57.3 billion) in credit lines to companies developing coal-fired power plants in the region.
• The IFC's 'Green Equity Approach' and Paris Agreement alignment efforts contain loopholes that allow equity clients to underwrite bonds for coal developers or finance industrial projects powered by 'captive coal' plants.
• In Jambi province, Indonesia, the proposed 700 MW Jambi 2 coal plant is being developed by China Huadian, which has received credit lines from the IFC-backed Postal Savings Bank of China, despite public pledges from both the Chinese and Indonesian governments to stop new coal development.
• Coal development in Jambi province has caused severe local impacts, including the pollution of rivers, respiratory issues and skin conditions in children, and the disruption of endangered Sumatran tiger habitats.
• The IFC's indirect financing extends to other major projects, such as the 1,200 MW Bangko Tengah (SS-8) plant in South Sumatra and the 700 MW CIIDG‑Huadian Sihanoukville Power Station in Cambodia, both involving China Huadian.

APA

Trend Asia (2023). How Coal Finance is Flowing through the IFC’s Paris Alignment Loopholes. https://trendasia.org/wp-content/uploads/2023/10/7574-IDI-Report-Blowing-Smoke-FA-2-Digital.pdf

Chicago

Trend Asia. How Coal Finance is Flowing through the IFC’s Paris Alignment Loopholes. 2023. https://trendasia.org/wp-content/uploads/2023/10/7574-IDI-Report-Blowing-Smoke-FA-2-Digital.pdf.

Wikipedia

{{cite report |author=Trend Asia |title=How Coal Finance is Flowing through the IFC’s Paris Alignment Loopholes |date=October 2023 |url=https://trendasia.org/wp-content/uploads/2023/10/7574-IDI-Report-Blowing-Smoke-FA-2-Digital.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{trendasia2023how, author = {{Trend Asia}}, title = {{How Coal Finance is Flowing through the IFC’s Paris Alignment Loopholes}}, institution = {Trend Asia}, year = {2023}, month = oct, url = {https://trendasia.org/wp-content/uploads/2023/10/7574-IDI-Report-Blowing-Smoke-FA-2-Digital.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }