Subsidies for fossil fuels can be used to finance climate action: World Bank

By Ovunc Kutlu

ISTANBUL (AA) - Subsidies for fossil fuels, agriculture and fisheries that harm nature and economies can be used to finance climate action across the world, according to a report released on Thursday by the World Bank.

Fossil fuel use is one of the major causes of 7 million premature deaths each year due to air pollution, it said in the report “Detox Development: Repurposing Environmentally Harmful Subsidies.”

Agriculture subsidies are responsible for the loss of 2.2 million hectares of forest per year, or 14% of global deforestation, while fisheries subsidies that exceed $35 billion every year are a key driver of dwindling fish stocks, oversized fishing fleets and falling profitability, it added.

The World Bank said trillions that are spent by governments on inefficient subsidies are making climate change worse, and they can instead be used to solve the climate problem.

While direct government expenditures in agriculture, fishing and fossil fuels total about $1.25 trillion, the subsidies' impact on people and the planet amount to over $6 trillion per year, it noted.

The institution advocated for subsidy reforms that should include measures such as building public acceptance, introducing complementary measures like subsidy reductions and providing social protection and compensation, as well as finding sound strategies for reinvesting reform revenues.