As Southeast Asia emerges from the pandemic, policymakers at both the regional and national levels must implement a green recovery to future-proof the economy and the health and safety of our people and planet.
By Tze Ni Yeoh
South Korea’s Democratic Party won a landslide victory in its April 2020 elections, on the back of a top-notch response to the COVID-19 pandemic. In a landmark move following the elections, President Moon Jae-in announced a Green New Deal, a strategy to reach net-zero carbon emissions by 2050. Under this new deal, the country will pass legislation to implement a carbon tax, stop financing for construction of coal plants, promote investment in renewable energy and establish a training center to help workers transition to green jobs. While it has been lauded as “stunningly ambitious” and a first for East Asia, the agenda follows in the footsteps of the EU’s Green New Deal announced this March.
The world is entering an era where sustainability is seen as an economically prudent choice, with environmental co-benefits. As the current pandemic shows for public health, the cost of being ill-prepared and uninformed is far greater than the initial cost of investing in resilient institutions and systems.
For Southeast Asia, sustainable development must rise to the top of the policy agenda. The post-pandemic response can ensure regional resilience against future shocks. Further, investments today in clean energy and resource-efficient, circular production models can unleash innovation and products that cater to the demands and needs of generations to come.
Globally, institutions, scientists and a growing movement of young people are demanding broad-based stimulus packages to support climate-positive investments, with studies citing the mutual economic and environmental benefits of a green fiscal response in the post-pandemic period.
Why ASEAN, why now?
If ASEAN member states were a country, they would have the fifth-largest economy in the world. By 2060, Asia-Pacific countries will account for some 90% of the 2.4 billion new members of the middle class entering the global economy.
A rapidly growing, urban population consumes more of everything, which could place vital natural assets (e.g. forests, oceans) under greater threat. As is, environmental issues plague much of the region.
Every year, between 2005 and 2015, the region lost 8 million hectares (an area equivalent to 111 Singapores) to deforestation due to logging and agriculture. Deforestation increases our chance of contracting the next COVID-19, as loss of habitat drives wild animals closer to human populations and increases the likelihood of zoonotic viruses spilling over to the human species. Critically, Southeast Asia is home to nearly 15% of the world’s tropical forests, which play a crucial role in hosting millions of species of flora and fauna, regulate our climate and serve as a global carbon sink.
In addition, four out of the top five ocean plastic polluters in the world are in Southeast Asia. Furthermore, many ASEAN countries, with their long coastlines and archipelagos, are highly susceptible to climate change effects such as sea-level rise.
The need for change is emphasized in a recent report by the United Nations, which projects that Asia Pacific countries will not achieve any of the 17 Sustainable Development Goals (SDGs) by 2030 if they continue on their current trajectories.
Build back better
ASEAN member states have been quick to introduce distinct and measurable stimulus packages to address the sharp health and economic repercussions of the virus, but there has been a lack of notable efforts to build resilience against future shocks.
The latest ASEAN Policy Brief points to unprecedented spending, easing of monetary policies and suspensions of loans, among other measures. Regionally, member states are working on immediate financial cooperation, including strengthening multi-currency swap agreements to provide short-term liquidity to countries in need.
However, to date, member states have yet to announce or coordinate any meaningful responses to build resilience against future physical shocks, particularly one that remains post-pandemic: the climate crisis. Without firm action, press announcements from the ASEAN Secretariat that highlight the need “to integrate biodiversity conservation into the COVID-19 response” risk becoming lip-service, missing an opportune time for reform.
ASEAN policymakers, at the regional and country levels, must build back better. The state of the economy and the region’s critical natural assets both demand a more ambitious plan for resilient recovery.
Shaping the green new normal
The immediate response to the pandemic may be limited to relief for households and firms and crisis containment. However, as recommended by the IMF, large stimulus packages are best designed with the following priorities in mind: 1) increase spending on green infrastructure such as renewable energy or climate smart technologies and 2) reduce or avoid spending on carbon-intensive investments, such as fossil fuels or high-emission vehicles.
In the long run, governments must first increase capacity to measure and assess climate risks. Without expertise and data, countries are steering blind in a world with greater uncertainties due to climate change.
Second, the frontier of innovation must be reimagined. We can no longer rely on traditional, extractive and wasteful models of production—the so-called “linear economy”. This means we must reconsider subsidy and tax regimes. Taxpayer monies should be spent to catalyze innovation that serves both people and the planet, such as incentivizing ESG (Environment, Social and Governance)-aligned capital and corporations.
Finally, global and regional coordination is necessary, especially in a region as diverse as ASEAN. Each member state has different levels of capacity and expertise; thus, the coordinating role of ASEAN as a forum is critical to sharing knowledge and resources across the region. Policymaking and coordination at a regional level, like in the EU, can pool common expertise, share burdens equitably and foster accountability among member states.
The COVID-19 pandemic signals the best and worst of what is to come. It has strengthened the resolve of countries, like South Korea and the EU, to pursue a green new normal. At the same time, the pandemic exposes deep vulnerabilities and societal divides in a volatile and uncertain climate. But as the crisis reveals opportunities, it is not too late for ASEAN to step up and make bolder commitments to secure our collective future.