Tuvalu PM says fossil-fuel investments by climate fund manager 'not a good look'
Tuvalu's Prime Minister Feleti Teo confirmed the country is conducting an internal review after an AFP investigation revealed that Mercer, the US firm managing Tuvalu's roughly US$200 million sovereign trust fund, had invested in coal mines, gas exploration and the world's largest oil refinery. Teo said the revelations surprised the government and undermined Tuvalu's intensive climate advocacy, prompting a re-examination of the fund's 'fossil fuel exposure.' The Tuvalu Trust Fund, created in 1987 with Australian, New Zealand and UK backing, provides essential revenue for the aid-dependent atoll nation. Separately, Tuvalu featured in regional diplomacy as a Taiwan diplomatic ally at a cultural gala and as a participant in India-promoted Pacific outreach programs.
Why it matters
As one of the world's most climate-vulnerable states, Tuvalu has built its international identity around urgent fossil-fuel phase-out advocacy, making the disclosure that its own safety-net fund underwrites fossil projects politically awkward at home and abroad. The episode arrives as Tuvalu deepens reliance on external arrangements—including its landmark Falepili Union migration-and-security treaty with Australia—and as the Pacific remains a contested arena between Beijing and Taipei, with Tuvalu among Taiwan's dwindling diplomatic allies.