Singapore-France Economic Forum 2019

Finance sector urged to help drive Asean's climate change efforts

The finance sector has a "powerful role" to play in helping to offset the effects of climate change, which South-east Asia is especially vulnerable to, said an executive from the World Wide Fund for Nature.

Ms Jeanne Stampe, its head of Asia sustainable finance, told the second Singapore-France Economic Forum yesterday that in addition to extreme weather, rising sea levels and chronic heat stress, food and water insecurity will also affect the region.

"The climate-related negative impacts will result in annual economic losses of 6.7 per cent of the Asean region's gross domestic product by 2100, which is far higher than the global average of 2.6 per cent," she said on the second day of the forum at the Lee Kuan Yew School of Public Policy.

Yet despite signing up to the Paris Agreement on climate change, many Asean countries are not doing enough, Ms Stampe noted.

Common reasons include a lack of funding and the need to electrify countries rapidly.

This means "non-state players must and can drive change", she said, suggesting financiers could move away from funding unsustainable projects given that 88 per cent of Asean's fossil fuel generation assets, as well as 56 per cent of planned assets, are incompatible with the Paris targets.

"If governments lack ambition to scale up clean energy to shift away from coal, the financiers can pull away from financing new 30-to 40-year assets that will bust the carbon budget," she said.

They can also lobby governments to create transparent bidding processes, she said at a panel about climate change.

Fellow panellist Benedict Chia, the Singapore National Climate Change Secretariat's director for strategic issues, spoke about the Republic's emissions targets, such as its aim to increase the adoption of solar energy to 350 megawatt peak by 2020 and to one gigawatt peak beyond that.

Asked by an audience member why a carbon tax which penalises consumers is adopted rather than measures focused on oil giants, Mr Chia noted that a price on carbon is an efficient way to address climate change as it sends a signal through the economy, and gets people to reconsider how to reduce emissions.

A version of this article appeared in the print edition of The Straits Times on March 16, 2019, with the headline 'Finance sector urged to help drive Asean's climate change efforts'. Subscribe