Climate change impact on Philippine economy serious: ADB warns

RP, 3 other Asian countries face costly climate change risks

By Purple S. Romero, | 04/29/2009 12:52 AM

The Philippines is one of 4 Southeast Asian countries likely to experience wider economic contraction of 6 percent by 2100 because of environmental risks, the Asian Development Bank (ADB) said Tuesday.

Without these risks, the Philippines, Thailand, Indonesia, and Vietnam would just experience an economic decline of 2.2 percent, the ADB said in its report, “The Economics of Climate Change in Southeast Asia: A Regional Review.”

The multilateral lender said the 4 Asian countries are most vulnerable to the “catastrophic risks” brought by climate change that the 6 percent projected decline exceeds the global mean’s decrease of 2.6 percent.

The ADB also monetized the annual losses of the entire Southeast Asian region due to climate change. It said this environmental phenomenon would shave off $230 billion from, or 6.7 percent of, the region’s gross domestic product (GDP).

The economic backslide of climate change is worse for the Philippines, Thailand, Indonesia and Vietnam because they have dense population in coastal areas, are agriculture-driven, and have a frail adaptation backbone, the lender stressed.

The 4 countries are expected to suffer from a decline in rice yield by 50 percent due to climate change. By 2020, the Philippines is forecasted to receive the biggest blow with a 75 percent plunge. Indonesia would dip 34 percent.

Flooding would also increase due to sea level rise. The monthly flow of the Mekong River in Vietnam would climb to 41 percent in the basin and by 19 percent in the delta.

Currently, however, the Philippines is the most vulnerable country among the four when it comes to floods and storms. From 2000-2008, the Philippines was hit by over 100 storms, affecting 35 million people. The situation is expected to get worse as climate change looms due to increased precipitation.

What to do?

ADB vice president Ursula Scahefer-Preuss said in a statement that Asian countries could hit two birds with one stone by implementing stimulus budgets with environment-friendly investments in them.

She cited investments on efficient energy, and low-carbon technology and infrastructure. She said governments could transform these climate change triggers into revenue boosters.

“Southeast Asian nations should address the dual threats of the financial crisis and climate change by introducing effective green stimulus programs – as part of larger financial stimulus packages – that can simultaneously shore up their economies, create jobs, reduce poverty, lower carbon emissions and make them more prepared for the worse effects of climate change,” she said.

The Philippines could take the lead of the region’s main economic partners – China and the United States. Their governments have already put in place “green” stimulus plans.

Out of its $584 billion-economic recovery package, China reportedly allotted around $200 billion to the development of waterways infrastructure, energy efficient buildings and low carbon vehicles.

The United States, on the other hand, allocated $78 billion, nine percent of its $787 billion-stimulus package to greening public buildings, transportation and buttressing research and development for renewable energy.

In the Philippines, the P330 billion stimulus package called Economic Resiliency Plan provides for over 100,000 “green” jobs. These include 50,000 upland farmers for the Department of Environment and Natural Resources’ (DENR) reforestation and agroforestry program, and 59,111 forest guards earning P3,000 a month also from the DENR.

What is being done?

The ADB noted that countries have already implemented different adaptation measures for particular sectors to survive the impact of climate change. But it noted that these measures are “mostly reactive rather than proactive.”

The report added that “their implementation is scattered rather than systematic, isolated rather than integrated, and measures often offer short-term benefits, rather than long-term solutions.”

The Philippines had 2 adaptation projects that were criticized as reactive:
• Metering and pricing of water use under the water resources sector
• Use of silvicultural practices in the forestry sector

On the other hand, 5 were deemed proactive:
• construction of multi-purpose reservoirs, dams and water-impounding systems under the water resources sector
• development of early warning systems or network for the agriculture and forestry sectors
• increasing awareness on forest fire prevention in local communities under the forestry sector
• preparation of hazard and vulnerability maps under the coastal and marine resources sector
• raising information on programs under the coastal and marine resources sector

To improve their adaptive capacity in the agriculture and coastal zones, the ADB said the 4 countries should be willing to spend $5 billion annually by 2020 to build sea walls and cultivate drought and heat-resistant crops.

Dr. Juzhong Zhuang, chief economist of the ADB said that the benefits would “outweigh” the costs in the long run.

He estimated that while these costs would eat 0.2 percent of the GDP, the benefits would add 1.9 percent in the economic output of the four countries by 2100.

Mitigate, too

While adaptation measures are important, ADB also called on the Asian countries to reduce their carbon discharges. These discharges are now popularly measured as the carbon footprint, or the estimate of how much carbon dioxide and other toxic greenhouse gases are produced to support the population’s lifestyle.

Indonesia was recorded to have produced 59 percent of—the highest in—the entire region’s greenhouse gas emission (GHG). Thailand followed with 6 percent, the Philippines with 4, and Vietnam with 2.

In 2000, Southeast Asia contributed 12 percent to the world’s total GHG emission

Land use change and forestry sector was the main culprit for the region’s GHG emission, supplying 75 percent of the region’s total carbon discharge. The energy and agriculture sectors came in second and third, with 15 percent and 8 percent GHG emissions, respectively.

The ADB said that mitigation is feasible in the region, following its huge potential for carbon trading. For a carbon price of $20 per ton of carbon dioxide, Southeast Asia is foreseen to lessen carbon emission by 300 million tons.

Efficient transport systems could also help cut carbon discharges. This would reduce Philippines’ carbon discharge by 40 metric tones by 2020, and Thailand by 30 metric tons. Vietnam’s use of natural gas by 2010 could diminish GHG emission by four metric tons.

The four countries were pushed to also switch from coal to renewable energy for power generation.

However, Datu Zamzamin Ampatuan, undersecretary of the Philippines energy department, said that the closure of local coal power plants particularly located in Visayas could presently do more harm than good.

“Coal powerplants are something we really have to contend with, but there are areas that have very little sources for renewable energy, such as in Visayas,” he explained.

SOURCE: ABS-CBN News, rp-3-other-asian-countries-face-costly-climate-change-risks


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