Catalog

Box 4-2. Intrasectoral Integration Illustrated

Market forces govern most aspects of technology transfer, although ministries of industry can take measures to promote the use of cleaner production technologies. These include information dissemination on the potential benefits in terms of increased productivity from the use of clean technologies. Regional industries still have a long way to go in understanding the potential benefits of pollution prevention and waste minimization. For example, encouraging industries to become certified under ISO 14000 standards will have a positive effect on both productivity and environmental behavior. Because of regional economic integration and globalization, the demands of shareholders and consumers from outside the Asia and Pacific region are exerting pro-environmental pressures on the regions' export industries. Closer to home, local communities are also demanding greater accountability for environmental practices and corporate citizenship from their industrial neighbors. Ministries of industry can take the lead in negotiating corporate environmental codes of conduct, complete with voluntary monitoring systems and agreed upon sanctions for violations.

At the same time, ministries of industry can take the lead in promoting new industrial sectors that are less resource- and pollution-intensive, reducing economic dependence on highly polluting industries while simultaneously creating new employment opportunities. The location of industries, preferably away from sensitive ecological zones and within estates that can efficiently handle wastes, can also have a profound effect on the sector's environmental behavior. For example, the PRC has pioneered the co-location of industries that can use each other's wastes. If waste streams become valuable inputs, there is less incentive to ignore fugitive leakages or to dump the wastes into the most convenient repository. Specific incentives can be offered to encourage industries to relocate to the same area. SMEs may be easier to relocate than larger factories.

Facility licensing provides a key opportunity to influence investment and locational decisions by firms. For example, Singapore's Economic Development Board (EDB) and the Jurong Town Corporation (JTC) have used the tools of promotional incentives and licensing procedures to ensure high environmental performance on the part of investors locating in Singapore. The EDB requires that new investors submit details of production technologies proposed along with an assessment of how the proposed facility would achieve compliance with Singapore's tough environmental standards prior to licensing approval. Access to promotional privileges is contingent on an acceptable plan for meeting the environmental standards. Sometimes the EDB will require location at an alternate site, or changes in abatement and pollution control equipment prior to approval. Through these procedures Singapore has managed to maintain ambient air and water quality while continuing to attract large flows of international investment capital.

Science and technology development is crucial in effectively reducing poverty and environmental degradation. Except for basic research, most research and development in the region is privately financed. One exception is Japan, where substantial resources are committed to basic research in and promotion of more energy- and resource-efficient technologies. Government ministries of science and technology can make important contributions in supporting applied research, facilitating technology transfer, and building the capacity of private firms for sustained innovation and technology upgrading. Much attention needs to be paid in this regard to the successes and failures of Asian and Pacific economies in building technological capabilities in science- and technology-intensive fields such as semiconductors and bioengineering. Debate still rages on the role that central governments played in the success of countries such as the Republic of Korea and Japan in achieving world-class technological capabilities in these industries. What is less controversial is the opportunity for public-private collaboration in technology development and adoption. In addition, Taipei,China has successfully pioneered a model of close collaboration among private industry, the ministry of industry and government-funded research institutes such as the Industrial Technology Research Institute (ITRI). Collaboration between the science and technology ministries and private and public institutions now extends to the areas of energy and environment (for example, through benchmarking of environmental performance in the semiconductor industry). ITRI also has a major research program underway in the area of clean technology.

In many DMCs, a separate ministry of agriculture deals with food crop production, plantations, and grazing lands. Such organizations typically have a wide range of mandates, from food production to land conservation. The opportunities for intrasectoral policy integration fall within five main categories. The first is that of integrated land use planning. Broader land-use planning that includes an agro-ecological perspective is often overlooked or serves as the basis for contentious debates among mission-based resource management departments. There is a need for much stronger land-use planning, and a ministry of agriculture can take the lead in resolving disparate interests. Increasingly, this authority will be vested in regional and local governments. Therefore, strong working relationships must be established between national, regional, and local authorities to strengthen land-use planning.

Second is a establishment of secure land tenure rights that can improve both economic and environmental incentives in the agricultural sector. The lack of secure, well-defined property rights in the Asia and Pacific region provides perverse incentives for appropriation of these rights by either the state or well-connected individuals. Traditional, customary, and commercial property rights must be acknowledged, registered, and strengthened. State ownership may be needed to protect critical ecosystems that provide unique ecological services to a large number of people or endangered species, such as large watersheds and old-growth forests. Assignment of private property rights may be the solution for other intensively used resources, such as issuing secure land titles to farmers with insecure ownership.

Third, the agriculture sector (especially irrigated agriculture) has historically been heavily impacted by subsidies on resource use. It is also a sector in which inefficiencies in resource use are pervasive. The large-scale irrigation schemes implemented during the Green Revolution are extremely inefficient, delivering as little as 40 percent of the water to crops. Subsidies exacerbate the problem by encouraging the expansion of inefficient supply systems and by discouraging demand-side behavior that would improve water delivery services. An important element of policy integration is an audit of all existing subsidies and resource pricing systems within the agricultural sector. As discussed further, addressing water use will typically also require a high degree of intersectoral policy integration (for example, to implement integrated river basin management).

A fourth key category is agricultural research. Feeding the growing population of the Asia and Pacific region will require substantial further advances in agricultural food productivity. It is critical that such advances be based on less resource-intensive production methods, and this is a key research priority for agricultural research institutions. Such research should include bioengineering of food products. Additional research and development is required to support sustainable agricultural systems that depend less on high usage of water, fertilizers, and pesticides and that place greater emphasis on resource management and soil and water conservation.

Finally, ministries of agriculture can take the lead in performing environmental impact analysis of agricultural production, focusing especially on the long-term health effects of chemical usage in food production, and in disseminating this information.

Forestry is a sector within many Asian and Pacific countries where the principles of intrasectoral policy integration are already well advanced. The major problems are implementation and enforcement. Plans for sustainable forestry abound even as illegal logging and unsustainable management practices continue. Many countries within the region have adopted national forest action programs with technical assistance from donors. Under these forest sector action programs, national ministries are responsible for maintaining accurate records of the national forest estate, and local forest use and access rights are the basis for allocating forest resources to their highest valued uses. This allocation would include benefits derived from all forms of marketed forest products as well as the ecological services provided by forests.

For policy integration to succeed in the forestry sector, it is generally agreed that greater decentralization of authority and management responsibility and greater dependence on community-based forest management practices are required. Centralized ministries lack the staff and resources to effectively manage forestry systems. Devolution of management responsibility could be encouraged to the maximum extent that is politically and institutionally feasible and in parallel with the devolution of resources and management capability at the local and regional levels. Forest management plans could be prepared with the participation of local communities and authorities and in compliance with national commitments to the Biodiversity Convention, the Convention on International Trade on Endangered Species of Wild Fauna and Flora, and possibly the United Nations Framework Convention on Climate Change if major carbon sequestration issues are involved. National ministries can also take the lead in promoting the adoption of voluntary or mandatory ecolabeling schemes for both harvesting and production, in the evaluation of conservation funds, in carbon trading and other financial tools, and in the evaluation of plans for carbon sequestration.

Box 4-3. Approaches for Intrasectoral Policy Integration

Intrasectoral policy approaches may be (i) for a ministry of energy to take the lead in working with firms and other stakeholders to identify environmental performance goals for the energy sector (such as the percentage of energy obtained from renewable sources), (ii) focus on conditionality and environmental review where strategies and actions within line ministries (such as new loans and science and technology initiatives) would be subject to prior internal environmental review, and (iii) focus on integrated planning such as for fisheries, river basins, and regional economic development.

The suitability of these different approaches will likely vary by sector and across countries; they may also be used in combination. All the models share the common principle of internalizing environmental concerns within sector-based, economic decision making.