Finance plays a pivotal role this year as it may contribute to a fairer and more environmentally sustainable mining industry.
In the global push towards decarbonisation and energy transition, the role of public development finance institutions (DFIs) and export credit agencies becomes increasingly significant. This is particularly true in the context of transition minerals, such as nickel and rare earths, essential for the production of green energy technologies.
The World Bank, a key player in global development finance, has taken a proactive step with its Evolution Roadmap, initiated in 2022. This initiative aims to review and update the bank's mission, operations, and resources, potentially expanding concessional policy finance to middle-income countries.
The SDGs, a blueprint for achieving a better and more sustainable future, also play a crucial role in this story. Relevant SDGs include 7. Energy, 9. Infrastructure, 11. Cities, 12. Consumption, 13. Climate, 16. Peace, and 17. Partnerships.
The G20 Just Energy Transition Partnerships (JETPs) and the World Bank's own Country Climate and Development Reports (CCDRs) can contribute towards a more just and equitable transition when aligned with efforts to integrate sustainability and inclusion measures into national policy frameworks. However, of the World Bank's 54 CCDRs, only 9 mention a specific strategy to mitigate environmental and social risks associated with transition minerals.
Strengthening policy commitments to sustainability both up and downstream in green energy technologies is essential in global development finance discussions. Establishing enforceable traceability mechanisms is crucial for improving transparency, reducing environmental harm, and ensuring fair labor practices in transition mineral supply chains.
The coming year presents several pivotal decision points for public DFIs and export credit agencies regarding their engagement with transition mineral supply chains. A pioneering minerals traceability initiative was introduced by Colombia at the 2024 United Nations COP16 biodiversity summit, to be presented for a vote at this year's UN climate conference, COP30, set to be held in Brazil in November.
Public DFIs and export credit agencies critical in 2025 for supporting a more sustainable and inclusive transition minerals supply chain include those providing development financing, low-interest loans, project financing, blended finance, grants, and credit guarantees that align with internationally recognized sustainability standards and human rights frameworks. These institutions aim to enable value creation, economic diversification, and adherence to environmental and social safeguards throughout the mineral value chain.
This article, originally published on Dialogue Earth under a Creative Commons license, covers topics such as Carbon & Climate, Energy, Manufacturing, and Policy & Finance, with regions focusing on China, Global, and the United States. As the world moves towards a greener future, the role of public finance institutions in ensuring a sustainable and equitable transition cannot be overstated.
