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Asia-Pacific Climate Digest Issue #8 : Week 1, May 2021

Compiled and Curated by Purnima Joshi.

More money is flowing into green, sustainable finance. But the Asia-Pacific region needs to up the ante in terms of being ahead of the curve in order to meet its climate targets of 2030 and 2050, and more so because the region has been among the most highly impacted by climate change disasters. Apart from Japan and China being ahead of their Asian peers in terms of understanding need for environmental disclosure, most of Asia is not taking climate risks into account in working towards developing climate resilient infrastructure. Yet, all is not as bleak as ESG reporting by business in the region is slowing and steadily increasing, which is clearly a positive sign.

The key themes this week are on climate finance, corporate strategy, inter-government partnerships on SDGs, sustainability goals…

Eco Business, 26 April 2021

Key Themes : Finance, ESG. Leadership Summit, Climate Change

Green finance will help put the brakes on climate change, but Asian companies risk missing out

  • Asia is on the front line of climate change with six of the ten largest economic loss events in 2019 caused by extreme precipitation, and courting private investment will be key to plugging the finance gap to fulfil the need for climate resilient infrastructure. But Asia is not taking climate risks into sufficient account, according to a panel of experts speaking at the recent CNA Leadership Summit

  • Asset owners and managers are placing emphasis on environmental, social and governance (ESG) considerations in their investment agendas and wasn’t greater disclosures, generally looking at how the businesses they invest in are going to insulate themselves against risks, such as excess carbon emissions. However, the integration and reporting of ESG remains patchy, particularly in Asia, thus could be detrimental to companies based here looking for capital. In this regard though, China and Japan appear to be ahead of their Asian peers in terms of understanding the need to report their environmental impact and have high disclosure rates.

  • There should be certain mandatory obligations that are created to take this seriously.

Key Themes : ASEAN, Paris Agreement, Climate Change

ASEAN needs a green new deal

  • More than 190 countries around the world have issued commitments to curtail greenhouse gas (GHG) emissions over the five years since the signing of the Paris Agreement on climate change and these commitments when summed up would reduce GHG emissions by a mere one percent by 2030, whereas a 45 percent reduction is needed to avoid catastrophic climate change in the decades ahead.

  • Southeast Asia is one of the most vulnerable in the world to climate change with its low-lying coastal cities and extensive agriculture being at risk. Several countries in the Association of Southeast Asian Nations (ASEAN). But the region has failed to reduce emissions by even one percent. Instead, individual countries have proclaimed their intentions, with no substance or follow through. ASEAN needs to take a radical new turn, and develop an ambitious, cohesive plan for lowering GHG gas emissions.

  • Extreme climate events, from floods to typhoons already affect the livelihoods and health of millions of people in ASEAN and cause substantial economic losses to business and governments, as a result of which the ASEAN needs more than an economic recovery plan; it needs an economic reset. It must develop its own New Green Deal, one that pays special attention to renewable energy, transportation and forests.

Eco Business, 26 April 2021

Once-in-a-lifetime opportunity for investors as South-east Asia goes green

  • Governments across Asia have pledged ambitious carbon neutrality plans backed by massive stimulus to push for green and sustainable industries as the stakes are high with Asia having 15 of the world's 20 most vulnerable cities and crop yields could fall by 7 per cent to 25 per cent over the next 30 to 50 years. South-east Asia's governments are thus pledging big investment in green technology.

  • Some market developments to look out for are :

    • Sustainable Smart Cities : With cities being a key contributor to climate change, responsible for 75 per cent of carbon emission and transport and buildings being the largest emitters, smart-building solutions can unlock cost savings by adopting efficient energy usage. Also, the future of transport has to be electric.

    • Energy Transition : Resource extraction and energy generation are still very much coal-reliant and inefficient in the region and it is not realistic to suddenly replace fossil fuels with renewables. However, the transition to natural gas is one low-hanging fruit.

    • Sustainable Food Chains : Employing technology and localising production are key to feeding a growing and large urban population in a sustainable manner.

    • Reconfiguring supply chains : South-east Asia's manufacturing hub can become a viable alternative to China and supply chains can be reconfigured sustainably. As supply chains shift to this region, more robotics and automation will be employed to improve productivity and energy efficiency.

Eco Business, 22 April 2021

Key Themes : Climate Impact, Net Zero Emissions, Climate Change

Which countries in Asia Pacific are doing most to protect the environment in 2021?

  • · Five countries in the Asia-Pacific that have made recent strides to safeguard nature, from curbing the illegal wildlife trade to stemming the tide of plastic waste are : China, Australia, Bhutan, Brunei and New Zealand, and below are some of their highlights :

    • China : announced a permanent ban on wildlife trade for human consumption.

    • Australia : where the country’s energy mix needs to change over the next 30 years “on the road to net zero emissions” with “the commercialisation of low emissions technology” which will help them to meet their target. Also, single-use plastics will be phased out by 2025, or sooner.

    • Bhutan : which boasts the largest proportion of forest cover in Asia, making a critical contribution to wildlife protection.

    • Brunei : where around 80 per cent of land lies under forest cover, and roughly 40 per cent of it remains untouched.

    • NewZealand : which in a world first announced it will make banks accountable for the climate impact of their investments. The government is also considering introducing a land reform bill which will overhaul a controversial regulatory system for land use

The Straits Times, 19 April 2021

Key Themes : Marine Ecology, Climate Change

Which countries in Asia Pacific are doing most to protect the environment in 2021?

  • Climate change and environmental pollution have made finding enough sea life to harvest more difficult. Every year the waters are a little less icy - warming as much as 2.6 times more than the world average - changing the undersea habitat and casting doubt on the future.

  • According to research, climate change has caused the change of habitat of sea life and the influx of non-native species. Between 1968 and 2017, the sea surface temperature around Korea rose 1.2 deg C, compared to a world average of 0.48 deg C, and warmer waters have brought new, subtropical species that have displaced the traditional catch, and changed the sea floor habitat by introducing more stony coral and killing off seaweed forests. Large beds of seaweed have disappeared, replaced by rock-like coralline algae and resulting in the decrease of marine resources.

Key Themes : Water Crisis, Climate Change

India's deepening water crisis at the heart of farm protests

  • India’s water crisis looms over an agrarian crisis that has been brewing for decades. Home to a fifth of the world’s population, India has only 4 per cent of the world’s water and the country is the largest extractor of groundwater in the world, with 90 per cent used for agriculture.

  • Climate change has made the monsoon rains - a lifeline for over half of India’s cultivated area - unpredictable and left farmers even more reliant on groundwater. Rice requires standing water in fields but hotter summers are increasing the amount lost due to evaporation.

The Business Times, 28 April 2021

Key Themes : Climate Impact, Green Technologies, Climate Change

Reimagining the technological pathways to APAC's sustainable future

  • The UNESCAP’s Sustainable Development Goals Progress Report 2020, showed that Asia-Pacific is not on track to meet the targets set within the 2030 Agenda for Sustainable Development. with the region falling behind on markers related to climate action and responsible consumption.

  • To reach the 2030 goal, governments are relying on a combination of technology and policy solutions to fast-track progress. It is time however to rethink our approach to technology in the sustainability arena wherein businesses and governments should prioritise what they can do today to harness existing technologies creatively and effectively

  • Developing, financing, scaling and driving adoption of new technology takes time. For instance, in the field of agritech, there are many technologies that show great promise for improving food systems and tackling hunger.

  • Existing technology such as big data and analytics, IoT and artificial intelligence are yet to be fully harnessed and in addition to implanting existing technology in new ways, it is also important to audit current capabilities within the workforce, address any gaps and build a sustainability-first mindset.

The Business Times, 28 April 2021

Key Themes : Climate Impact, Green Finance, Climate Change

Ecological sustainability will underwrite Indo-APAC post-pandemic recovery

  • Ecological sustainability will underpin the post-COVID 19 economic recovery in Southeast Asia and the broader Indo-Asia Pacific (Indo-APAC) with government stimulus packages worldwide kickstarting economies, sustainable assets in the green and blue economies being among the major beneficiaries of these capital flows and generation of new jobs.

  • In the energy sector of Asia, an energy transition to solar and other renewables is occurring, demonstrating growing investor appeal for eco-friendly assets with stable long-term yields and regulated contracts.

  • Sustainable financing is set to grow, driven by regulatory pressure worldwide for corporates to meet environmental, sustainability and governance (ESG) requirements and heightened investor demand. Major investment houses are also creating and expanding their ESG teams. In the longer term, government stimulus will migrate to sectors like renewable energy and other ecologically sustainable options, especially as employment in the sustainability sector offers better and more equitable pay.

  • Government policy and investment will be vital in establishing roadmaps towards lower carbon economies.

The Fiji Times, 27 April 2021

Key Themes: Finance, Corporate Strategy, Climate Change

Australian pension fund association raises bar for companies on climate change

  • Australia’s main association representing pension fund investors – the Australian Council of Superannuation Investors (ASCI) - is tightening its climate change policy (to go into effect from 2022) and may recommend voting against directors of companies which are not moving fast enough to meet Paris goals.

  • Companies should align their corporate strategy to the Paris Agreement and the objective of net zero emissions by 2050, and set short, medium and long-term emissions reduction targets and stress test the resilience of their portfolios and strategy against climate change scenarios, it said.

  • The ACSI and other investors have so far secured commitments for ‘Say on Climate’ resolutions from Woodside Petroleum Ltd, Santos Ltd, Rio Tinto Ltd, and Oil Search Ltd in 2022.

The Straits Times, 25 April 2021

Key Themes: Governance, Climate Change

Ideas from conversations with public on Green Plan to be pursued

  • Grace Fu, Singapore’s Minister for Sustainability and the Environment, said that ideas arising from conversations with the public around the Singapore Green Plan 2030 will be assessed and pursued, with an eye on ultimately sparking meaningful climate action.

  • This was announced at the first of a series of planned engagements seeking Singaporeans' views and ideas on the Green Plan 2030, launched in February to chart a more sustainable path forward for the Republic.

  • The plan sets out targets like having more energy-efficient buildings and improving resilience to the impact of climate change, such as by boosting local food production.

  • The Green Plan demonstrates the Government's commitment to ensure Singapore remains a green and liveable home for many generations to come.

ScandAsia, 30 April 2021

Key Themes: Inter-Government Partnership, Zero Emissions, Climate Change

Green initiative continues to grow in Cambodia

  • The Joint Crediting Mechanism (JCM) Model Project of the Ministry of Environment Japan (MOEJ) is involved in the implementation of climate-friendly projects subsidised by Japan in Cambodia.

  • The JCM helps partner countries, particularly developing countries, reduce their emissions of GHGs, and reach zero emission status in a specific time period, to achieve their Sustainable Development Goals (SDGs). This is done through high-quality and effective technology transfers, assistance and subsidy for renewable energy projects.

  • Cambodia joined the JCM in 2014, becoming one of 17 countries that agreed to work with Japan to combat harmful levels of greenhouse gas emissions and climate change. Thailand, the Philippines, Laos, Myanmar, Vietnam and Indonesia are the other Southeast Asian countries involved with JCM.

The Asset, 29 April 2021

Key Themes: Finance, ESG, Sustainability Goals

ESG focus to transform investing landscape

  • Wealth management clients in Asia-Pacific are showing a growing interest in environmental, social and governance (ESG) themes, indicating that a major reallocation of investments could be in the cards.

  • About 89% of respondents in the region say they have personal sustainability goals, compared with the 78% global average, a new study finds. However, 59% feel their wealth manager falls short of understanding their values.

  • “Clients are now investing for purpose and looking beyond return on investment. For clients, purpose underpins the reasons why they invest – including their desire to do good and to create a meaningful personal legacy,” according to the 2021 EY Global Wealth Research Report.

The Edge Malaysia, 1 May 2021

Key Themes: Economy, Climate Finance

Growing Champions: Scaling up and enabling climate finance in Malaysia

  • Green financing will play an increasingly important role in global investment in the coming years, and Malaysia can play a pivotal part in this journey.

  • A report from Boston Consulting Group (BCG) and the Global Finance Markets Association (GFMA) titled “Climate Finance Markets and the Real Economy” describes a significant US$3 trillion (RM12.3 trillion) to US$5 trillion annual financing need and opportunity for financial institutions.

  • Climate finance across debt and equity capital markets, syndicated and bilateral lending, project finance, structured products, derivatives and securities finance represents an estimated global revenue pool of more than US$25 billion annually over the next decade.

Additional Reads :

CGM's Asia-Pacific Climate Digest is compiled by communications consultant Purnima Joshi.

With over two decades of experience in corporate communications, Purnima combines her skills in creative and communication along with her passion for working for the community.

She has worked on a multitude of projects in waste management, circular economy, building active citizenship in the community, some of which have won awards.

These also include a project on building climate resilience for UNICEF as well as some award-winning projects. She has been associated with several NGOs in an advisory capacity for over 10 years.


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