World's central banks financing destruction of the rainforest
Related: Bankrolling deforestation: Central banks accused of financing environmental destruction (Global Witness)
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Source: The Guardian
World’s central banks financing destruction of the rainforest
Corporate bonds intended to inject liquidity into markets profited companies engaged in deforestation
Andrew Downie in São Paulo
Wed 28 Sep 2022 09.46 BST
Last modified on Wed 28 Sep 2022 10.20 BST
Some of the world’s biggest central banks are unwittingly helping to finance agri-business giants engaged in the destruction of the Brazilian Amazon, according to a report published on Wednesday.
The Bank of England, the US Federal Reserve and the European Central Bank are among the institutions that have bought millions of dollars in bonds issued by companies linked to deforestation and land-grabbing, according to the report Bankrolling Destruction, published by the rights group Global Witness.
“Because these programmes are guaranteed by the respective governments in the UK, the US and EU Member States, this means taxpayers throughout those territories are unwittingly underwriting companies engaged in the destruction of the Amazon and other rainforests,” according to the report.
The banks buy corporate bonds issued by big companies in an attempt to inject liquidity into financial markets when the private sector is reluctant to lend. Known as “asset purchase programmes”, these measures aim to reduce the cost of borrowing for companies and were used extensively during the pandemic as a way of bolstering economies.
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Read more: https://www.theguardian.com/environment/2022/sep/28/worlds-central-banks-financing-destruction-of-the-rainforest
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Source: Global Witness
Bankrolling deforestation: Central banks accused of financing environmental destruction
Three of the world’s largest central banks stand accused of investing in the destruction of climate-critical forests in Brazil.
In recent years, the US Federal Reserve, the European Central Bank, and the Bank of England have sought to inject additional liquidity into financial markets by purchasing corporate bonds, a tool used extensively to support economies during the pandemic.
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Key findings
This new investigation also reveals:
• The US Federal Reserve has bought a combined total of $16 million of bonds issued by the Archer-Daniels-Midland Company (ADM), Bunge Ltd Financial Corp, and Cargill, Inc. since 2020, all companies accused of involvement in environmentally destructive activity in Brazil; and
• Since 2016, the Bank of England has also purchased an undisclosed share in a £150 million corporate bond issued by Cargill, Inc., and the European Central Bank has bought an undisclosed amount of debt issued by Bunge Finance Europe B.V.
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Read more: https://www.globalwitness.org/en/campaigns/forests/bankrolling-deforestation/
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