HSBC and Deutsche Bank have ruled out investments in Queensland’s controversial coal terminal expansion at Abbott Point, near the Great Barrier Reef, responding to calls from environmental groups and tourism operators in the region.
Local campaigners are fighting to stop a government-approved expansion of Abbot Point that would involve dumping 3 million cubic metres of dredged soil about 25 kilometres (15 miles) from the Great Barrier Reef, an issue that is also of concern for UNESCO’s World Heritage committee.
UNESCO has condemned Australia’s approval of dredge spoil dumping in the iconic Great Barrier Reef, driven by Australia’s foolishly optimistic coal expansion.
And this week, they took their fight to Europe, urging Deutsche Bank, Societe Generale and HSBC not to back the Queensland coal projects.
HSBC is Europe’s largest bank, while Deutsche Bank is Germany largest and the latest move shows the two financial institutions clearly see the social, environmental and economic risks the Abbott Point project embodies.
When asked about Abbot Point investment at HSBC’s annual general meeting in London on Friday, Chief Executive Officer Stuart Gulliver said it was “extraordinarily unlikely it would go near it”.
The announcement matches Deutsche Bank’s position announced the previous day, when the head of its Supervisory Board, Paul Achleitner, said “we are currently not involved with this project and will also not be involved with it in the future”.
HSBC was the 15th largest financier of coal globally between 2005 and 2013, while Deutsche Bank was among the top five until recently.
Their decision to abandon Abbot Point puts Australia’s big four banks on notice that coal investments are at risk of becoming stranded assets, and do not have social license to continue as their customers are increasingly warning.
Citibank sees structural decline in the global thermal coal market, and independent analyses show that Australian projects such as those in Queensland’s Galilee basin are commercially unviable.
It is part of a growing trend away from coal.
The IMF and World Bank are calling on finance ministers to remove fossil fuel subsidies and use policies such as carbon taxes to reallocate resources and combat climate change; China, India and the US are moving away from coal; and continued oversupply and rapidly slowing demand growth thanks to renewable expansion will only exacerbate coal’s already bleak future.