INCHEON, South Korea—Getting rid of fossil fuel subsidies, land use, and making agriculture greener are among the “low-hanging fruits” for countries in their effort to transition to net zero, according to the Asian Development Bank (ADB).
In a briefing here on Wednesday, ADB Chief Economist Albert Park said removing fuel subsidies can discourage its consumption; land use can lead to efforts that cut greenhouse gas emissions from deforestation and cropping activities; a “greener” agriculture mean using better fertilizers.
These efforts, Park said, can be addressed through regulations and legislation, and not necessarily investments that may be costly given that countries are still recovering from the pandemic.
“Things like green building codes, (setting) carbon emission standards, and other ways that again, it’s all about making people, if there isn’t a carbon price out there, make people internalize actions that are going to be harmful for the environment,” Park said.
For the development sector, ADB President Masatsugu Asakawa said the need to address climate change and tread the path to net zero is also a call for ADB and other multilateral development banks to evolve.
This MDB evolution must recognize that development is no longer possible without effective climate action; investing in global public goods; and be key players in the effort to mobilize the levels of financing now required for development, from billions to trillions.
Asakawa stressed that traditional models of lending and grantmaking will not be enough to respond to the challenge of climate change. MDBs must undertake efforts to “help economies transition, swiftly and justly, to a net zero future.”
“We need to answer the call for MDBs to do more to maximize our financing capacity through game-changing new mechanisms; to leverage the enormous investment potential of the private sector and philanthropies; and to maintain our place as a stable, reliable financial institution,” Asakawa said.
Earlier, ADB said the vulnerability of the Philippines to climate change also makes it a country that has the most to gain in the shift to a more carbon-neutral world.
This is especially crucial since climate change under a high emissions scenario could impose GDP losses of 24 percent in the whole of developing Asia, 35 percent in India, 30 percent in Southeast Asia and 24 percent in the rest of South Asia by 2100.
The report’s coauthor and ADB Economic Research and Regional Cooperation Department (ERCD) economist David Anthony Raitzer said in a recent briefing that the Philippines saw an expansion in the share of coal in terms of the country’s electricity generation. This, he said, is not “economically preferable” in the study’s model.
The primary recommenda-tion of the report is for countries to tap carbon pricing as a way to finance green technologies that are carbon- neutral to attain the below-1.5 degree celsius target set under the Paris accord.
The report noted that the region’s share of global greenhouse gas (GHG) emissions doubled to 44 percent in 2019 from 22 percent in 1990 and is expected to remain at this share until mid-century under current policies.
At current levels of GHG emissions, ADB said, the region would exhaust the remaining global carbon budget consistent with limiting warming to 1.5 degrees Celsius by 2040.
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