Towards the greening of Asia

Andrew Sheng, The China Post

How is Asia going to be able to achieve its ambition of greening?

Two new books come with different perspectives of how this can be achieved. Former South China Morning Post editor Mark Clifford, currently executive director of the Asia Business Council, has written a great book on The Greening Of Asia. He points out that the Asian Miracle was achieved on the back of cheap labour and environmental degradation.

China is already the world's largest emitter of greenhouse gases (GHG), with Indonesian haze also a major problem, as everyone in Singapore and Malaysia will testify.

Because of their population size, five countries - China, India, Indonesia, the United States and Russia - account for half of the global annual GHG emissions, which will only increase as Indian and Indonesian growth accelerates in the coming years.

There are, of course, three parties to blame for the current climate warming.

The first is consumer lifestyle; the second, business production; and last, but not least, bad government policies and taxes/subsidies that encourage resource wastage and carbon emissions. Urbanisation and higher income account for the bulk of the increase in carbon emissions, because most cities generate higher income with larger consumption of energy and resources. As, going forward, most mega-cities will be in Asia, the solution to climate change will rest largely with Asia.

Lifestyles can be changed but, as Mr Clifford rightly points out, business can point the way. The Dutch discovered that if you put the electric meter near the main door which you look at every day, you will save 30 per cent more on your electricity bill than if you tuck the meter in the closet.

Macquarie University professor John Mathews tells another story of the Greening Of Capitalism: How Asia Is Driving The Next Great Transformation. His narrative is more technical, going back to the basics of sustainable economics of fossil fuel-driven industrialisation towards a new transformation to a circular economy (where resources and energy are recycled).

As a keen observer of how China is transforming its industrial model from fossil fuel towards solar and alternative energy, Professor Mathews addresses the next Great Transformation.

India, China and Asean's move into the industrial age involves 10 times the speed, a hundred times the people and a thousand times the energy intensity of the Western Industrial Revolution.

Governments can do a lot to help make the damage to the environment from this transformation more tolerable and less risky. Getting the emission standards and the measurement of energy efficiency and pollution to be more transparent is the first step. Enforcing even the current legislation would also help a lot.

There is considerable hope about the greening of Asia, because the more advanced economies of Japan, Korea and Singapore already have proved that with the right political will, it is possible to deal with pollution and energy efficiency questions.

Which is why Paris COP21 (21st Conference of Parties) is so important a signal, not just to the world, but particularly to Asia.

If Asia cannot solve the challenges in its journey to the green, open and inclusive society, the world will go up in flames.

'Sticky issues' at Paris talks

Martin Khor, The Star

Paris is touted as the "last chance" to save the world.

Most leaders gathered at the COP have come to believe this, and certainly the scientists and non-governmental organisations who have been pushing the climate agenda for decades.

So the odds are that by hook or by crook a deal will be struck and COP21 will have to produce a Paris agreement plus an accompanying decision to adopt it.

And yet the final solutions appear so far away.

As usual, the US has set the tone on some of the contentious issues.

One of the most complex issues is whether the agreement will be legally binding. The US team quietly made known that it cannot have a treaty that internationally binds its emissions reduction pledge, otherwise that will have to go to Congress for approval, and it will not approve.

A solution will thus be found such that the Paris agreement will be binding as a framework and in procedural matters (including that countries submit pledges that are subject to review), but the actual numbers will be placed in another document and not be subject to being legally binding. That may be a neat hybrid solution, but it would not fool the world.

Another big issue is the finance and technology that the developing countries demand to enable them to switch to a low-carbon economic pathway.

The chair of the G-77 (Group of 77) and China, South Africa's Ambassador Nozipho Mxakato-Diseko, said that "nothing under this convention will be achieved without the provision of finance and the transfer of technology which are crucial elements of the Paris outcome".

While the French President in his opening speech had indicated empathy for the developing countries' insistence on finance, other developed countries, especially the US, do not want anything specific on finance in the core agreement.

Even more complex and systemic is the contentious matter of "differentiation". Both Chinese President Xi Jinping and Indian Prime Minister Narendra Modi highlighted "common and differentiated responsibilities", as did many other leaders, but this term is really taboo for the US.

Another issue that will go down to the wire is "loss and damage", a concept now recognised but yet to be in operation at the convention.

Developing countries want the Paris agreement to recognise that it is legitimate to support developing countries with funds for rescue and rehabilitation necessitated by climate change-related events such as typhoons, heavy rainfall and drought. But developed countries do not want to fund "compensation" for this loss and damage.

These are some of the "sticky issues" that remain to be resolved.

Keep your fingers crossed that in the end a good and fair agreement will be reached. Whether it is adequate to win the fight against climate change is another huge issue, which will no doubt keep the debate going after Paris.

Boosting China's green industry

Yuan Ying, China Daily

The green industry should serve as one of the major drivers of China's economic growth.

But this is a daunting task to fulfil.

On the one hand, China's green industry needs at least two trillion yuan (S$436 billion) in investment a year. On the other hand, green financing has become a hurdle for China's sustainable growth, because about 85 per cent of the green investments are non-governmental in nature owing to the lack of financial support from the government. This is not surprising, though, because the green industry is known for its relatively high risk and inefficiency in yielding the expected results.

A self-sufficient photovoltaic power station of 5MW, for instance, will provide poor returns (from 8 per cent to 17 per cent, based on where it is installed), not to speak of the other difficulties such as power instability, change in ownership and insufficient supply of funds.

The yields of some green projects are even lower than the average 8 per cent.

Therefore, public subsidies from governments are necessary to boost China's green industry. More importantly, financial reform is necessary so as to involve more non-governmental capital.

Governments, on their part, have to initiate institutional reform to ensure green loans enjoy favourable interest subsidies or can be directly invested in industries.

• The View From Asia is a weekly compilation of articles from The Straits Times' media partner Asia News Network, a grouping of 22 newspapers. For more, see www.asianewsnet.net