Seoul Gazette - Tuvalu says fossil fuel holdings revealed by AFP 'not a good look'

The investigation published last week showed that global advisory firm Mercer has invested on Tuvalu's behalf in funds exposed to coal mining, gas exploration and the world's largest crude oil refinery.

Prime Minister Feleti Teo told AFP he was personally disappointed to learn of these investments, which Tuvalu is now reviewing.

"It's not a good look on Tuvalu, given the very strong advocacy work that we do in terms of combating climate change," he told AFP on the sidelines of the Island State Oceans Summit in Tokyo.

Few countries are more exposed to climate change than Tuvalu, a chain of coral atolls reckoning with acidifying oceans, tropical disease and rising seas.

Land is already so scarce across the archipelago -- halfway between Australia and Hawaii -- that the international airport runway doubles as a makeshift sports field.

With a fragile economy and few natural resources, Tuvalu relies on a government trust fund to help foot the growing costs of the climate crisis.

Mercer took over management of the $200 million Tuvalu Trust Fund in 2022.

It has since invested in funds that include Indian energy giant Reliance Industries, which owns the largest oil refinery in the world, and The Southern Company, the second-biggest greenhouse gas emitter in the United States.

- Climate reparations -

"I think we were also surprised when we first heard of that information," Teo said, referring to AFP's findings.

"So we are doing our own internal due diligence, but it's obviously not a good image to us."

Tuvalu has long been renowned for its staunch advocacy in support of urgent climate action.

It was one of the first nations to sign a proposed treaty calling for an end to the expansion of fossil fuel projects.

Tuvalu will receive a rare burst of international attention later this year when it hosts leaders for a special summit ahead of the UN's COP31 climate conference.

The meeting has been billed as a chance to show how climate change is battering the South Pacific.

Teo said a key focus would be on how big-polluting nations can help finance the costs of climate mitigation in exposed states like his.

Pacific island neighbour Vanuatu secured a landmark win last year in the International Court of Justice, which found nations had a legal duty to prevent harms from planet-warming pollution.

Teo floated the idea of taking legal action to force climate reparations, saying a class action involving multiple nations would be "more attractive to us".

"I think it will be much stronger than a country individually taking such actions.

"But it's a possibility that we are not ruling out."

Mercer previously told AFP: "We do not provide commentary or analysis on our clients or their investment portfolios."

W.Nam--SG