Across Asia, there is an increasing trend of “greenwashing,” where public development banks advertise their green energy investments as “climate solutions” while sidelining communities, human rights defenders, and the environment.
This is especially harmful in repressive contexts, where oversight and accountability are nearly absent and the repression of communities and defenders is a constant feature of civic life.
From 2019 to 2023, 13 development banks invested around $88 billion in 18 countries with closed civic space, mostly in Asia. The World Bank, Asian Development Bank (ADB), and Asian Infrastructure Investment Bank cover more than 50 percent of these investments, spread across finance, energy, transport, infrastructure, and other sectors.
In 2023 alone, investment in climate finance reached $125 billion, double the 2019 figure, with much of it channeled into adaptation and mitigation efforts in low- and middle-income countries.
Realities of Climate Financing
The reality of climate financing has been far from ideal. Issues around accuracy and transparency – including the over-reporting of expenditures against climate finance commitments – put banks like the World Bank and ADB at risk of greenwashing.
When banks mask profit-driven investments as climate solutions, they may end up doing more harm than good.
As authoritarianism rises across many parts of Asia, greenwashing often goes hand in hand with the violent repression of fundamental freedoms in countries with repressed and closed civic spaces.
China, Uzbekistan, and Vietnam, for example, share around $50 billion of total investments in closed civic spaces. They also account for 60 percent of the 1,159 cases of human and environmental rights violations in closed civic spaces in Asia, as documented by FORUM-ASIA from 2019 to 2023.
By investing in repressive contexts where local communities and environmental human rights defenders cannot safely oppose destructive green projects, banks end up indirectly legitimizing and rewarding violent compliance and silence.
Amidst shrinking civic space and increasing retaliation against dissent, bank investments should strive to become instruments of inclusive development rather than tools of repression. Otherwise, such investments will only reinforce the tight grip of repressive regimes over fundamental rights and freedoms.
Sidelining Communities
Whenever profit is prioritized over the welfare of both people and planet, local communities pay the price. We see this in the way development banks fund “climate-smart and green energy” projects that actually cause mass displacement, livelihood loss, and environmental degradation, among other problems.
In countries where governments operate with little to no meaningful checks and balances, affected communities face extreme barriers to raising their concerns, let alone halting such projects. Fundamental freedoms like access to information, participation, and peaceful assembly are frequently curtailed, making it dangerous for communities and defenders to speak up.
In the Philippines, the Korean Export-Import Bank-financed Jalaur River Multipurpose Project in Iloilo is part of former President Rodrigo Duterte’s Build, Build, Build legacy. The project has been long opposed by Indigenous Tumandok communities over fears of displacement from their ancestral lands. Their resistance was reportedly met with violence, including alleged killings of community leaders. The current regime under President Ferdinand “Bongbong” Marcos Jr. continues to benefit from a climate of impunity – entrenched under Duterte – in a country consistently ranked among the deadliest for environmental human rights defenders.
In Pakistan, communities were reportedly sidelined during the planning stages of the World Bank-funded Madyan Hydropower Project along the Swat River. Consultations were deemed inadequate or coercively managed, leading to loss of agricultural land and threats to the local ecosystem. As the country grapples with deep economic precarity and high climate vulnerability, the government’s repressive approach – marked by shrinking civic space, censorship, and militarized development – further marginalizes communities and stifles dissent.
In Kyrgyzstan, the World Bank is backing the Kambarata-1 Hydropower Project along the Naryn River. Local communities face potential harms arising from environmental damage through downstream water disruption and flooding. Although neighboring Kazakhstan and Uzbekistan frame the project as a regional benefit, it also raises the prospect of future tensions, with vulnerable communities and their livelihoods caught in between. Amidst Central Asia’s broader climate of repression, it is becoming even more difficult for communities and defenders to speak up, as seen in Kyrgyzstan’s passage of the Foreign Representatives Law, which silences dissent and suppresses fundamental freedoms.
Under repressive regimes, even so-called “green” or “climate-smart” projects are implemented without adequate and mandatory human rights due diligence, environmental and social impact assessments, free, prior and informed consent, and meaningful consultations.
Communities and defenders are often silenced through intimidation, surveillance, legal harassment, and in some cases, violence. In shrinking civic spaces, any expression of dissent is perceived as a threat to state authority. Repressive regimes exploit development finance for both material and reputational gain, using these investments to sustain their economic development agenda while presenting themselves as global climate leaders.
By financing these projects, banks – under the guise of climate action – enable authoritarian greenwashing, legitimizing oppressive regimes and concealing the real costs borne by vulnerable communities.
What Banks Can Do
To avoid fueling greenwashing and human rights abuses, development banks must divest and rethink the direction of their investments in repressive contexts. This divestment should be twofold: proactively investing in enabling environments while also divesting from repressive ones.
Banks must first align their climate and green energy portfolios with international human rights standards such as the Universal Declaration of Human Rights, the United Nations Guiding Principles on Business and Human Rights, the Paris Agreement, and the U.N. Declaration on Human Rights Defenders. These will help banks strengthen institutional policies to prevent complicity in repression.
Likewise, banks must ensure that investments do not proceed in environments where meaningful participation and accountability are virtually nonexistent and impossible. Mandatory human rights due diligence must be embedded across the project cycle, starting with a thorough assessment of the civic and political conditions in proposed green energy project locations.
In contexts where civic space is minimal, public participation is criminalized and defenders are at risk, no green energy project – no matter how “technically sound” – can ever be considered just or sustainable.
Banks must establish clear minimum criteria for green investments, prioritizing countries with open civic space, strong environmental protections, and robust accountability mechanisms. For example, while the ADB’s revised Environmental and Social Framework mentions civic space, it should go beyond lip service and actually translate into binding standards that filter out high-risk contexts.
In repressed and closed civic spaces, even the most well-designed green projects cannot function effectively, since project-affected communities and defenders cannot speak freely or safely access remedies.
Banks have the leverage and responsibility to resist the global rollback of rights by conditioning financing on civic freedoms. Withdrawing from existing projects in repressive regimes sends a powerful message: that human rights violations come with hefty financial consequences.
Until then, banks remain complicit in the very abuses for which they claim to have zero tolerance. And when these abuses are carried out under the banner of “climate action,” the harm is twofold: environmental injustice and authoritarian greenwashing.
Banks must ensure that their investments do not reinforce the very systems that suppress civic freedom and worsen the climate crisis. Instead of enabling abuse, climate finance must be grounded in rights-based policies that challenge authoritarianism and protect those on the frontlines of environmental justice.
