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Speech: How ASEAN Governments are Shifting to Green Growth

May 18, 2018

Speech of Senator Loren Legarda
5th Singapore Dialogue on Sustainable World Resources (SDSWR)
“How ASEAN Governments are Shifting to Green Growth”
May 18, 2018 | Grand Hyatt Singapore

I thank the Singapore Institute of International Affairs (SIIA) for this opportunity, as well as my fellow panelists and delegates, as we all commit today to a more resilient and more sustainable ASEAN community.

Our gathering today also serves as an important platform to sustain the discussions during the recently held Bonn Climate Change Conference leading to the upcoming 24th Conference of Parties (COP24) in Poland, primarily, for the accomplishment of the Paris Agreement rulebook, due this December.

The importance of countries’ Nationally Determined Contributions (NDCs) in achieving the goals of the Paris Agreement should be a recurring theme in climate talks because it emphasizes the urgency of operationalizing the mechanisms on climate finance, capacity building, and technology transfer, all of which the vulnerable countries need to transform their economies towards a low carbon development path.

For the Philippines, climate action is a matter of survival. According to the 2018 Global Climate Risk Index of Germanwatch, we rank 5th in the list of countries most affected by climate change for the period of 1997 to 2016. This entails an annual average loss of 2.89 billion US dollars or 0.6% of our GDP within the last two decades.[1]

We share this unfortunate reality with three other ASEAN countries that are also included in the same list: Myanmar at number 3; Viet Nam at the 8thspot; and Thailand ranking 9th.

The ASEAN Region, which heavily relies on agriculture, has experienced a downward trend in rainfall from 1960 to 2000 and rise in sea levels to 1 to 3 millimeters per year, as well as more intense and more frequent heat waves, droughts, floods, and tropical cyclones.[2]Projected economic losses include a decline of up to 50 percent of rice yield potential by 2100 and a loss of 6.7 percent of combined gross domestic product (GDP) each year by 2100.[3]

For us, we embrace adaptation and mitigation because our lives truly depend on it. However, we contend with what limited resources on finance, technology, and capacity that we have.

While we acknowledge that the means of implementation of the Paris Agreement will be critical in order to unlock the full potential of our country’s resilience, it will be a disservice to the millions of Filipinos if we wait for these means to become available before deciding to take action.

There really is no other recourse for us but to usher in green growth and transform our economy towards a low carbon and climate-resilient path. We pursue this path not only because we know it is the best way to protect our people and climate, but also because we know it will spur economic growth.

While more can still be done, I believe that the Philippines already has the enabling environment for this green transformation to transpire and prosper.

Our Philippine Development Plan (PDP) encourages the transitioning of our critical sectors by promoting and supporting green technology innovations; climate-smart infrastructure and designs; and low-carbon and energy-efficient urban transport systems.

As for legislation, we’ve already covered the basics. We have already enacted laws for clean air, clean water, Ecological Solid Waste Management (ESWM), rainwater catchment facilities, renewable energy, and other measures that protect the environment and address climate change and disasters.

Furthermore, our Green Jobs Act, which is the first in the world, will support the transformation of our sectors by promoting the creation of green jobs and fostering a just transition towards a green economy.

We are working with development partners to establish the Green Jobs Standards, Accreditation, and Certification System, which will streamline the processes for businesses applying for accreditation or certification, as well as provide incentives for green practices.

As a legislator, allow me also to emphasize one crucial task expected from us that many other legislators across the world seem to not take advantage of, and that is the power of the purse that rests on Congress.

Many, if not all, of our plans and strategies for climate action and green growth will remain as ideas if there is no appropriate budget to implement them. This is why, for three budget cycles in a row, I have advocated and ensured that our national budget is a climate budget.

This falls on my capacity as Chair of the Philippine Senate Committee on Finance, which allowed me and my colleagues, to enshrine climate change adaptation and mitigation, as well as disaster risk reduction, in the budgets of our government agencies, especially those dealing at the frontlines.

We recognize that all these national policies will be for naught if they are not mainstreamed at the local level. In partnership with local stakeholders in the academe, civil society, and private sector, we are harmonizing these policies with the local development systems and processes of our communities by enhancing the knowledge, skills, and capacity of our local government units (LGUs).

We abide by the principle that building resilience is local; therefore, in order to sustain green growth it must also be from the bottom-up.

We also foster this grassroots approach in finalizing our NDCs, which will be part of our commitment to the Paris Agreement. In order for our sectors to be on board with the process, we have collaborated with sectoral leaders in conducting validation meetings, consultations, and workshops for our NDC sectoral targets.

It is clear to us that our NDCs will be crucial in sustaining green growth. We don’t consider reducing further our carbon emissions as a sacrifice, but an opportunity.

The cost estimate to implement the identified mitigation actions for our energy, forestry, industry, and transport sectors alone is 4.12 billion US dollars for the period of 2015 to 2030.[4]

In the ASEAN Region, the demand for additional ASEAN green investments from 2016 to 2030 is an estimated US$3 trillion across four sectors: infrastructure (US$1,800 billion); renewable energy (US$400 billion); energy efficiency (US$400 billion); and food, agriculture, and land use (US$400 billion).[5]

Focusing on energy efficiency, it is estimated that US$300 billion is needed to improve end-use in the building, industrial, and transport sectors by 2030. Industry experts also projected that US$100 billion of investment is required to scale up electric vehicles across the region.[6]

This huge financial resource requirement to transit towards a low carbon economy would indeed require external support.Lending institutions have a critical role to play to unlock more investments, including those from the private sector, in the pursuit of low-carbon and climate-resilient growth.

A strong partnership among the government, the private sector, and the lending institutions will be greatly needed to put in place the right conditions to attract domestic and foreign low-carbon investments.[7]

In the Philippines, while we have banks that already finance green investments, green banking initiatives are not yet prioritized. In my many consultations with banks and financial institutions, these investments are considered too risky, which ultimately affects their bankability.

To encourage investments, a national loss and damage registry and vulnerability assessment could help our banks assess the need and urgency of a proponent for a certain project in a particular area.

The government should also provide technical assistance to assist the private sector in addressing regulatory challenges, as well as share the cost and risk in these climate investments.

I have also proposed the creation of a Philippine Green Bank, which would have natural bias to finance green projects. This could be developed and sustained using taxes on coal, other green financing reserves, or grants from foundations and corporations that support climate investments.

One groundbreaking action we did in the Philippine Senate is to impose higher taxes on coal, which, for decades, had enjoyed minimal taxes at 10 pesos or 20 US centavos per metric ton. There was stiff opposition, but we were able to increase the taxes to 50, 100, and 150 pesos for the next three years.

The new taxes are four times lower than what was originally proposed, but to break the wall that could not be penetrated on against dirty energy is, for us, already a monumental feat.

We welcome bold pronouncements from other countries phasing out coal, and personally, the Philippines must also consider fossil fuel as a thing of the past. We need to fully harness our immense access to renewable sources of energy, such as solar, hydro, and wind.

Implementing carbon pricing policies is one other measure that we intend to undertake in order to further support green growth and build resilience. Our emissions are very minimal, only at 0.33%, but we are committed to do this, also to sustain the call for the 1.5-degree Celsius climate goal that we have lobbied and fought for in the Paris Agreement.

The ASEAN community should lead by example and inspire the rest of the world to carry out their responsibilities and deliver on what is expected from them and more.

As one region, we need to carry the voice of the vulnerable. We can no longer remain silent. We must further demand for a planet where not just the ASEAN community but all communities around the world could truly prosper.

We don’t exist in isolation of each other. Whether industrialized or developing, we should all realize that we are on this one planet together. The transformation towards green growth is an uphill battle, but it is one crusade that we must all fight and win.

Thank you.***

[1] 2018 Global Climate Risk Index, Germanwatch.https://germanwatch.org/de/download/20432.pdf

[2] ASEAN Cooperation on Climate Change.http://environment.asean.org/asean-working-group-on-climate-change/

[3] Ibid.

[4] Based on the Philippines Mitigation Cost Benefit Analysis (updated report, June 2015 version) by the Climate Change Commission through USAID under the Building Low Emission Alternatives to Develop Economic Resilience and Sustainability (B-LEADERS) project

[5] United Nations Environment Programme and DBS. Green Finance Opportunities in ASEAN. https://www.dbs.com/iwov-resources/images/sustainability/img/Green_Finance_Opportunities_in_ASEAN.pdf.

[6] Ibid.

[7] Green Finance: Key business considerations for financing a sustainable low-carbon economy. BIAC Discussion Paper. June 2016.