Asian Actions to Improve Prosperity while Protecting the Global Commons – Haruhiko Kuroda | Asian Development Bank

Asian Actions to Improve Prosperity while Protecting the Global Commons – Haruhiko Kuroda

Speech | 2 February 2012

Keynote address by Haruhiko Kuroda, President, Asian Development Bank, at the Delhi Sustainable Development Summit 2012, Hotel Taj Palace, New Delhi, India

I.  Introduction

Your Excellencies, distinguished guests, ladies and gentlemen: It is my great pleasure to be speaking today at this prestigious annual event. I would like to express my sincere appreciation to the Government of India for its hospitality, and to the Energy and Resources Institute (TERI) for hosting this Summit.

The theme of this summit --"Protecting the Global Commons: 20 Years Post Rio"-- invites us to take stock of our collective progress, and challenges, in safeguarding natural resources. Climate change is, of course, the foremost global commons problem we face today. Combating climate change requires international cooperation at an unprecedented level. We must move in harmony to reach our goal.

My remarks today will focus on Asia and the Pacific. The region has the greatest number of people at risk from the adverse impacts of climate change. With commitment, policy innovation, and the right investments, the countries of Asia and Pacific can lead the world toward a more sustainable and resilient future.

The Asia and Pacific region presents tremendous opportunities with its growing markets, still relatively low levels of consumption, and the need to fulfill enormous infrastructure requirements. We must move toward deeper structural and systemic change in the way goods are manufactured and services provided. The green economy itself can become an engine of growth and the driver for a new generation of green jobs—bringing a higher quality of life. Pursuing green growth lies at the core of achieving the three dimensions of sustainable development, namely environmental, social and economic.

I would now like to share with you some examples of how the Asia and Pacific region has begun to follow the green growth path through three types of actions: (i) policies and investments to encourage green national economies, (ii) regional cooperation for sustainable natural resources management, and (iii) links with global partnerships to finance green growth.

II.  National Actions for Green Economies

Around the region, leaders are recognizing that a better quality of economic growth is possible—one that can simultaneously meet aspirations for greater economic prosperity and provide a cleaner and greener future. Many countries have made major policy statements on their aspirations to follow this path.

Asia is rapidly becoming a global leader in green investments, with many of these focusing on low-carbon power generation. For example, China has become the top installer of both wind turbines and solar thermal systems. India now has the fifth largest wind power capacity in the world, and is encouraging the rapid expansion of biogas, solar, and other forms of renewable energy—especially for rural areas—through such innovative policies as renewable energy certificates. Thailand is expanding its renewable energy base—having tripled its biogas capacity since 2008, mostly through private investment.

Many countries in Asia and the Pacific are creating plans for Nationally Appropriate Mitigation Actions, or NAMAs. China aims to reduce the intensity of its carbon dioxide emissions per unit of GDP in 2020 by 40% to 45% compared to 2005 levels, and India by 20% to 25% over the same period.

In Indonesia, where deforestation is the largest source of greenhouse gas emissions, the Government has voluntarily committed to a 26% reduction in its emissions by 2020 compared to a business as usual scenario, and a 41% reduction if it has access to adequate international support. Its ambitious forest sector reform program includes a two-year moratorium on forest concession permits, and development of a national strategy.

At ADB, we can see the steadily growing demands for support to these efforts. Our clean energy investment is a good example. Here in India, ADB is investing $150 million alongside commercial banks, utilities and the private sector to expand small-scale solar power production. In Bangladesh, we are helping to achieve significant energy efficiency improvements in the brick-making, cement and chemical industries.

To reduce vehicle emissions, we are assisting Bangladesh, China, India, and Mongolia to develop energy efficient and passenger friendly Bus Rapid Transit systems. And in Viet Nam, Georgia and in Bangalore here, we are helping to establish efficient metro and light rail systems. We are also coupling our support for expanded renewable energy production with efforts to widen access to modern energy services, especially for the rural poor.

In less than 10 years, ADB's annual clean energy investment has increased tenfold, from $225 million in 2003 to nearly $2.2 billion in 2011. These efforts will need to continue and intensify. As a crucial part of our climate efforts, we will seek to mobilize significant funding to help close regional gaps in knowledge, capacity, and finance.

Clearly, as Asia is greening its development, ADB is greening along with it.

III.  Regional Cooperation for Sustainable Natural Resources Management

Beyond these national actions, we are seeing an increase in regional cooperation for sustainable management of natural resources, which are an important part of the global commons. Three stellar initiatives in Southeast Asia illustrate such regional partnerships.

The Coral Triangle has been referred to as the "Amazon of the Seas" and covers a vast area of ocean spanning Indonesia, Malaysia, the Philippines, Papua New Guinea, Timor-Leste, and the Solomon Islands. The six countries established the Coral Triangle Initiative to preserve and manage their shared resources by increasing investments for climate change adaptation in coastal areas, and addressing other threats.

The Greater Mekong Subregion's Biodiversity Corridors Initiative focuses on ensuring connectivity between existing protected forest areas while greening the transport, energy and tourism sectors.

The Heart of Borneo straddles parts of Indonesia, Malaysia, and Brunei, and contains the largest remaining rainforest in Asia. This initiative is introducing a management regime based on community empowerment and the use of market-based measures to reduce incentives for converting forests into palm oil or pulpwood plantations.

ADB is pleased to be a strong supporter of these large-scale programmatic initiatives, together with a wide range of global and local partners.

IV.  Global Partnerships to Enhance Financing for Green Growth

None of these efforts to transition to green growth will be cheap. Fortunately, the international community recognizes that developing countries face unprecedented financial challenges in shifting their economies onto sustainable growth paths.

As I mentioned in my address to you at last year's Summit, the key role of multilateral development banks is to use limited public sector funds to leverage the far more significant amounts of private capital needed to achieve green growth.

ADB works in partnership with a range of funding bodies established to support sustainable development and protect the global commons, including the Global Environment Facility, the Kyoto Protocol Adaptation Fund, and the Climate Investment Funds. For example, under the Climate Investment Funds, ADB partnered with other MDBs to mobilize $6.5 billion in concessional funding and grants for developing countries, of which $2.5 billion has been programmed for use in this region.

There is an enormous need for additional adaptation financing, and the launch of the Green Climate Fund was a significant outcome of the 17th Conference of Parties in Durban. We look to this new Fund to serve as the principal multilateral financing mechanism to mobilize $100 billion per year by 2020 for low-carbon and climate-resilient growth in the developing world. To achieve the $100 billion target, private sector resources must be effectively tapped through public-private partnerships, capital market instruments, guarantees to reduce the risks of entry by first investors in new green markets, and other such measures. We are hopeful that the Green Climate Fund will become quickly operational and that its Private Sector Facility can play a key role in this effort.

V.  Closing

Ladies and gentlemen:

The task ahead is daunting. It will not be easy to achieve the goal of protecting the global commons while also ensuring that our economies thrive and our people are given the opportunity to live up to their full potential. But the region is clearly stepping up to this challenge. Through actions to green national economies, regional cooperation to conserve valuable natural resource systems, and cooperation through global financing partnerships, the region is striving to do its part. We must all do our best to support these efforts. Nothing less than the future of our planet and our collective prosperity is at stake.

Thank you.