Opening address by ADB President Takehiko Nakao at the 10th Meeting of the ADB President's Advisory Group on Climate Change and Sustainable Development on 11 February 2019 at ADB headquarters in Manila, Philippines [As prepared for delivery]
Welcome to the 10th Meeting of the ADB President’s Advisory Group on Climate Change and Sustainable Development. This is the fifth time I have had the pleasure of hosting this gathering of distinguished experts. I would like to give a warm welcome also to the new members of the Advisory Group: Prof. Laurence Tubiana, Prof. Yukari Takamura, and Dame Meg Taylor, who is unfortunately not able to join us today.
The purpose of this meeting is to provide an update on ADB’s work in advancing sustainable development and climate change since the last meeting at ADB headquarters in June 2017, and to request from you as members of the Advisory Group inputs on ADB’s future strategic directions in this area.
This meeting is especially important as worldwide CO2 emissions have begun to increase again since 2018. Asia is now producing about 40% of total global emissions. As the Asian economy is growing and more energy is needed for houses and offices, industry, and transport, our region needs to play a critical part in global mitigation efforts.
Asia is increasingly vulnerable to climate-related disasters such as more severe and frequent typhoons, sea level rises, glacial melting, flooding, and droughts. Adaptation measures are another urgent requirement.
Achievements since last meeting
ADB has continued to advance on various fronts in support of our developing member countries. I am happy to report our actions in the following key areas since the last meeting.
Adoption of Strategy 2030
ADB adopted a new long-term corporate strategy in 2018. Strategy 2030 sets the course for ADB to respond effectively to the changing needs of our developing member countries. The strategy has seven key operational priorities, of which one is “tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability.”
To implement this agenda, we have set ambitious targets on climate change: First, 75% of the number of ADB committed operations (on a 3-year rolling average) will support climate change mitigation and adaptation by 2030. Second, cumulative climate finance from ADB’s own resources will reach $80 billion for the period 2019 to 2030. This builds on, and surpasses in ambition, our 2020 climate finance target of delivering annually $6 billion in our own financing for climate change mitigation and adaptation.
To meet these targets, ADB is ensuring that climate change, disaster risk, and environment considerations are fully mainstreamed in our operational strategies; country programming; and project design, implementation, monitoring, and evaluation documents. ADB is also facilitating access by our developing member countries to cleaner and smarter technologies, fostering green economic growth, and continuing to screen our projects rigorously for climate and disaster-related risks.
ADB will scale up support for climate change mitigation by prioritizing investments for low greenhouse gas (GHG) emission energy, implementing sustainable transport and urban transportation strategies, and encouraging developing member countries to shift to a low GHG emission development path in line with their Nationally Determined Contributions (NDCs).
On adaptation, we will take a comprehensive approach on resilience which incorporates four dimensions: physical resilience (resilient infrastructure), financial resilience (enhancing financial preparedness to climate and disaster risks through instruments such as contingent financing and insurance), social and institutional resilience (leveraging poverty reduction and social protection programs to build resilience to climate change and disasters), and eco-based resilience (conservation, restoration, and rehabilitation of ecosystems such as mangroves that deliver environmental and economic resilience).
Alignment with the Paris Agreement
At COP24 in Katowice, Poland, ADB joined the other multilateral development banks (MDBs) in announcing that we are together developing a dedicated approach to align ourselves with the objectives of the Paris Agreement. These areas are:
- Alignment with mitigation goals to ensure MDB operations are consistent with countries’ low-emission development pathways and the Paris Agreement’s mitigation objectives;
- Adaptation and climate-resilient operations, including managing physical climate change risks and increasing clients’ and their communities’ ability to adapt to adverse climate impacts;
- Further scaling up climate finance and accelerating support to countries in achieving their NDCs;
- Engagement and policy development support for accelerating the transition to low-emission and climate-resilient development pathways, while ensuring compatibility with the Sustainable Development Goals;
- Better monitoring and reporting on climate actions and results, with an emphasis on harmonizing approaches; and,
- Ensuring that internal MDB operations are in line with the Paris Agreement objectives.
ADB’s own sources of climate finance reached $3.6 billion in 2018, a slight decrease from 2017 which is explained by a number of key projects planned for 2018 moving to 2019. Although overall finance fell somewhat to $3.6 billion, adaptation investment was higher than ever at $1.1 billion. We have some way to go to reach our $6 billion target by the end of next year (2020) but are making good progress.
We continue to develop and apply innovative climate finance approaches, such as a green development fund project in Shandong in the People’s Republic of China for catalyzing climate finance. This will go to our Board later this year. It will finance a pool of green projects sponsored by local governments with mandatory green and financial bankability indicators.
We are mobilizing more external and internal financing for climate change and disaster risk management. Last year, for example, the Green Climate Fund approved $298 million in concessional loans and grants for innovative ADB projects in Cambodia, Kiribati, Mongolia, Tajikistan, Tonga, and Pakistan.
ADB has financed a number of innovative projects, such as a 40.5MW distributed renewable energy system using solar photovoltaic and wind power with advanced battery storage technology and energy management systems to supply reliable electricity across scattered beneficiaries in Mongolia.
We continue to function as a regional convener and connector. For example, ADB hosted events such as the 6th Asia-Pacific Climate Change Adaptation Forum in October, which was co-organized with the governments of the Philippines and Palau. More than 1,000 experts and practitioners came to ADB to discuss adaptation challenges and responses.
We have launched knowledge products on emerging issues such as new carbon market mechanisms under Article 6 of the Paris Agreement. Also, we have provided practical guides on disaster risk management in country partnerships strategies, natural hazard data, and disaster risk assessment.
ADB’s Office of the General Counsel has hosted events on climate and environment law by inviting judges and other law experts.
This is the tenth meeting of this Advisory Group, and I would like to take this opportunity to thank all of you for your invaluable contributions to ADB’s work on sustainable development and climate change over the past years.
Though there is still much to do, we have benefited from your generosity and deep expertise to make significant progress and ensure that ADB remains more relevant than ever as a partner to our developing member countries in the face of climate, disaster, environment, and sustainable development challenges.
After Prof. Hoesung Lee’s opening remarks and our discussion on the results and implications of the Intergovernmental Panel on Climate Change (IPCC) Special Report on Global Warming of 1.5ºC, Preety Bhandari will present ADB’s Strategy 2030 and its operational priority on tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability.
I would like to suggest the following points for our discussion this morning: First, how can ADB best position itself to deliver on its 2020 and 2030 climate commitments? Second, given the increasing demand for assistance on climate, disasters, and the environment on the one hand, and limited financial resources on the other, what types of activities should ADB prioritize in its developing member countries in order to fulfill its ambitious agenda?
Thank you and I look forward to our discussion.