Editor’s Note: This article first appeared in the International Development Journal, an online journal offering a platform to engage in debate and discussions on global policies and current affairs.
In a historic move, the Irish Parliament has passed a bill that will stop all investments in coal and oil. The new law was passed after getting 90 votes in favour and 53 against.
While it still has to get the approval of a financial committee before it becomes law, the passing of the bill means that divestment will begin from the Ireland Strategic Investment Fund valued at eight billion pounds.
The Ireland Strategic Investment Fund “is an €8.0 billion sovereign development fund.” The Fund seeks “to invest in transactions where it can make a difference, where its characteristics can enable commercial investment transactions with positive economic impact and can make it an attractive “investor of choice” for company and project sponsors and advisors.”
Commenting on the bill, Trócaire Executive Director Eamonn Meehan, is quoted by the World Economic Forum (WEF) as saying “[….] this move by elected representatives in Ireland will send out a powerful message. The Irish political system is now finally acknowledging what the overwhelming majority of people know: That to have a fighting chance to combat catastrophic climate change we must phase out fossil fuels and stop the growth of the industry that is driving the crisis.”
Once the bill gets the approval of the financial committee it will see Ireland become the first country in the world to completely remove funding for fossil fuels. It will also be the most aggressive move of any country and government around the world taken against the fossil fuel industry.
Given its relatively small size and global impact, Ireland’s decision to divest from fossil fuels, will not completely stop the fossil fuel industry nor will it make a major impact towards meeting global greenhouse gas emissions targets. However, according to the WEF, the decision “Stands as a benchmark for countries who want to strengthen their stance against climate change and show support for renewable energy.”
While Ireland is set to become the first country to divest from fossil fuels. As of December 2016, a total of 76 countries had made fossil fuel divestment pledges, valuing $5.2 trillion, as part of the Divest-Invest Initiative. This Initiative calls on “Investors of every stripe – from sovereign wealth funds to institutional endowments and retirement fund holders – to divest from the fossil fuel industries deepening the climate crisis and invest instead in climate solutions.” It labels itself as the “Fastest growing divestment investment movement in history.”