The Asia-Pacific region is the industrial and food production powerhouse of the world. However, currently, the region is at a critical stage of its development, while striving to deal with the compounding impacts of COVID-19 and climate crisis. Prior to the pandemic, the Asia-Pacific countries enjoyed the benefits of robust economic growth, which has brought significant welfare improvements and poverty reduction, however, at the high cost of increasing greenhouse gas emissions from the region. For instance, the seven countries in the region that are members of the G20—Australia, China, India, Indonesia, Japan, Russia and Turkey—in 2019 were responsible for over 50 per cent of global greenhouse gas emissions as well as 45 per cent of the world’s population,Footnote 1 while 5 of the 10 top countries with the greatest historic responsibility for carbon emissions since the beginning of the twentieth century are from Asia.
At the same time, the countries in the Asia-Pacific region are among the most vulnerable to climate change induced natural disasters—8 out of the top 10 countries by disaster occurrence and 7 out of 10 countries by disaster-affected population are in Asia-PacificFootnote 2 in the last decennia. Although the Asia-Pacific region cannot act alone on climate change, there is no doubt that action in this region can have a huge positive impact on the rest of the world, now.
Thus, how to continue robust economic growth and in a low-carbon manner is becoming a high priority for the countries in the Asia-Pacific region. Now, more than ever, the home grown ‘green growth’ approach with its tools to stimulate better quality growth—for example, by increasing innovation and providing new forms of support to the region’s poorest—seems the most viable development pathway.
However, countries in the region are yet to develop viable long-term low-carbon development strategies aligned with a green post-COVID-19 recovery that will allow societies in the region to move forward together, consistently and purposefully to reach the 1.5 C temperature goal reaffirmed at COP26 in the ‘Glasgow Climate Pact’. Fundamentally, the impacts of growing climate risks require decisive responses to ensure resilience as well as decarbonisation.
But are decisive responses on the cards?
1. The evidence on the gap in climate action in Asia-Pacific
Based on the 2015 Paris Agreement, the current expression of the response to climate change of each UN member state is through well-defined commitments in their Nationally Determined Contributions (NDCs). However, there is significant evidence that the NDC targets of the countries in Asia-Pacific are insufficient.
In particular, the region’s cumulative emissions reached a record of 36.7 GtCO2 in 2019. Then COVID-19 struck. This brought down emissions—but only temporarily. By mid-2020, Asia-Pacific emissions rose to 35 GtCO2—close to the 2019 record, and they are set to surpass the regional 2019 record by the end of 2021Footnote 3. Indeed, many Asia-Pacific countries were and remain keen to resume ‘normal’ activities as quickly as possible, especially as rates of vaccination improve, and those are expected to further increase regional greenhouse gas emissions.
This is despite 30 of the 49 countries in the region having submitted updated NDCs in the run up to the Glasgow COP26Footnote 4. But why? Is it simply because these countries only account for a third of the region’s emissions? Or is there something missing from the NDCs?
Overall, and as explained in the recently released joint assessment report by UN ESCAP, UNWomen, UNEP and the greenwerk Footnote 5 the regional NDC pledges—both updated and non-updated—at the time of writing collectively amount to roughly 13.5 GtCO2e in reductions by 2030—translating to an estimated 29.5 GtCO2e GHG emissions in 2030. But this is highly insufficient. Based on the recommendations of the International Panel on Climate Change (IPCC), to keep the world within the 1.5 °C temperature rise, the recommended GHG emissions levels by 2030 for the Asia-Pacific region should be around 9.8 GtCO2eFootnote 6.
This is partly because of the flexibility that is designed into the Paris Agreement. For example, it is important to see governments using either absolute targets or pre-1990, or as the IPCC recommends 2010 levels of greenhouse gas emissions baselines instead of business-as-usual (BAU) scenario baselines because of possible discrepancies in establishing BAU baseline years and varying methods of calculation, which will allow to harmonise reporting and compare mitigation efforts. That is very important to improve the understanding about the remaining relative share of greenhouse gas emissions each country will have and to develop viable long-term low-carbon strategy to keep within those carbon dioxide limits.
Furthermore, while it is crucial to recognise the different abilities countries have to combat climate change as a result of a lack of financing capabilities and other inhibitors, it is still important to differentiate between conditional and unconditional targets that countries include in their NDCs. Aggressive unconditional commitments no doubt demonstrate a higher level of ambition and dedication to mobilising existing finances for effective climate change mitigation action.
Thus, should all unconditional NDC commitments be met, regional GHG emissions are projected to grow to 18.4 GtCO2e in 2060. With more ambitious but climate finance-dependent conditional commitments, emissions would decrease further to 12.5 GtCO2e in 2060, which is still nowhere near the desired ‘net zero’.
Other assessments of climate ambition of NDCs globally, and in the Asia-Pacific region, concur with this analysis. The 2016, 2020 and 2021 reports by the UNFCCC secretariat find that aggregate emission reductions communicated in the initial round, and in the recently submitted updated NDCs, do not fall within the range of least-cost 2 C scenarios defined by the IPCC (IPCC, 2018, UNFCCC, 2021 and WHO, 2021).Footnote 7
However, there is some good news for the region.
First, a significant number of Asia-Pacific countries have made some net-zero commitments—34 of the Asia-Pacific member States have made carbon neutral pledges, with various deadlines and categories of commitment ranging from being a ‘proposed legislation’, a ‘policy document’, ‘adopted a law’, ‘achieved’ and those that are ‘not yet considered’. Incorporating these in the analysis suggests that 2030 regional emissions would grow then fall to 29.5 GtCO2e, and 2060 emissions could be reduced to 5.96 GtCO2e.
While a 5.96 GtCO2e Asia-Pacific is a vast improvement from the business-as-usual scenario, further climate action and a firm commitment to greenhouse gas emissions reduction efforts are necessary to avoid global temperature rises above 1.5 C. A net-zero 2050 for the region is critical in mitigating the worst effects of climate change for the Asia and Pacific region, and globally.
So, what can be done to raise ambition, including beyond COP26?
Raising ambition is about both actual policy tools and confidence—and embarking on a green post-COVID-19 recovery can help.
2. Raising ambitions through policy tools
While NDCs and overall emission reduction targets are seen as the key means for countries to express their ambition, each economy is different, and in reality, transformation of economies has to take place through various interrelated actions and in the sectors contributing he most to national greenhouse gas emissions. In addition, not all of these measures of ambition are (or are yet) expressed in the submitted NDCs from the region. Furthermore, there are some specific policy measures—such as carbon taxes or emissions trading—that once in place can enable a steep ramping up of ambition. These are critical to understand, and countries across the region can watch and learn from each other as the measures and policies are implemented.
For instance, Bhutan is already carbon neutral while the Maldives has announced a 2030 carbon neutrality target. China, Fiji, Japan, Marshall Islands, New Zealand, Singapore and the Republic of Korea all have carbon neutrality pledges before or after 2050. Within the region, 24 nations have signed the Climate Ambition Alliance, pledging to reach net-zero CO2 by 2050. Furthermore, 10 countries in the region have already peaked emissions, and the analysis suggests many more will peak by 2030 based on their NDCs.
The Philippines was the first country in the South-East Asia sub-region to set a moratorium on new coal and put in place several measures to support renewables. There are 10 countries in the region that have committed to 100 per cent renewable energy by 2060. Another seven countries have a no-New-Coal Commitment or Zero Deforestation Commitment, and another four have targets to reach at least 50 per cent share for renewable energy and/or to halve deforestation.
Overall, a total 19 nations in the Asia-Pacific region have either implemented or stated an interest in implementing a carbon tax, a national or sub-national emissions trading scheme. China’s emissions trading scheme (ETS), which is the largest carbon market in the world, started trading in July 2021; Singapore is currently reviewing the rate of its carbon tax, which was the first one in the region; and Indonesia launched a trial ETS in March 2021 for 80 coal power plants, which covers three-quarters of its national power generation sector.Footnote 8
However, even achieving all this will not be easy. For instance, Bhutan’s carbon neutrality status is threatened by the transport sector and will require additional commitments to be met to maintain this status. Many international organisations and studies have expressed disappointment at Japan’s cost of carbon at $3 USD/tCo2e, which is significantly lower than the international average for an economy of Japan’s size. China’s ETS was announced as imminently launching as early as 2014 but took years to actually do so.
And action by other countries in the region matters. Almost half of the Asia-Pacific countries are not willing to commit to a peak emissions date, including large emitters such as Indonesia, Turkey, the Islamic Republic of Iran and India. None of the large coal producing countries have announced a full phase-out of coal, although in April 2021, Japan announced a possible reduction of coal to 26 per cent of its energy mix by 2030–2031, and Japan, Korea and China have all now committed not to finance coal overseas.Footnote 9 Five countries in the region currently provide fossil-fuel subsidies amounting to over 3 per cent of their GDP, including Kyrgyzstan and Turkmenistan that provide subsidies equivalent to 11 and 8 per cent of GDP, respectively. A further 20 provide subsidies that amount to less than 1 per cent of GDP. Those policies unfortunately provide a direct signal to investors and consumers to that fossil fuels are there to stay.
So, what can realistically be done to ensure goals are made and met, unconditionally, as well as to raise ambition even further, especially in a post-COVID-19 context, where the pressure for growth at any cost is very high?
3. Raising ambitions through confidence enablers
Considering that most of the updated NDCs from the Asia-Pacific region were developed and submitted in midst of the pandemic, it becomes clear why these greenhouse gas emissions reductions commitments were low and insufficient. Although countries in the region were dealing with the uncertainty and confusion about the future of their nations under threat from a deadly virus, it was difficult to be more decisive in acting on climate change mitigation. Those countries that understood the interconnectedness between COVID-19 and the climate change crises have made better strides to deal with both eminent issues. Though most of the countries have some form of national-level decarbonisation commitments, they are often based on either moveable BAU targets or intensity-based unconditional or conditional targets. Similarly, their specific ambitions are often loose. Twenty-five countries for instance have a ‘plan’ to increase the share of renewables in their energy mix or reduce deforestation, but no specific target to aim for, which gives very little certainty to investors in these sectors.
Clearly, there was not a sufficient understanding in the countries that low carbon, energy efficient and non-fossil-fuel dependant economic development, coupled with increased investments in nature-based solutions for adaptation and mitigation makes perfect economic, social and environmental sense in a post-COVID-19 recovery stage. Moving forward with NDC implementation requires a number of underlying competencies or capacities supported by several enabling factors would enhance country’s readiness to both implement and raise the ambition of existing NDCs and future reviews and updates. In other words, what United Nations ESCAP call ‘enabling factors’.
In particular, four enablers can be identified.
First, mainstreaming NDC actions into national development plans and legal frameworks is critical to prioritise greenhouse gas emissions reductions. Creating a legal framework for climate change action makes greenhouse gas emissions reduction mandatory or mandatory for certain sectors. It can also be accelerated by anchoring top envisaged climate actions expressed in NDCs into the country’s development agenda, giving them the same or more priority as other developmental actions, or the other way around—initiating a comprehensive green growth strategy, that will guide national and international investment decisions and state-commissioned programmes.
Second, having channels of consultation with various stakeholders, especially other ministries within the government, as well as a clear high-political support from the Head of State or Prime Minister level with a direct line of reporting from the specific climate change ministry or department is critical for further advancing the climate action agenda. Establishing a coordination mechanism for consultation and engagement of sectoral ministries and subnational authorities in the NDC development and reviews is key to delivering NDCs as well as ramping up ambition according to local situation and conditions. If key policymakers and decision-makers are not aware of the country’s own climate change commitments, NDCs cannot successfully be implemented. Also, such consultation will ensure that the NDC sectoral targets for greenhouse gas emissions are included in the programmes for each sector, as well as at the local government level. Also, ensuring that policy-making institutions have a basis for coordination with stakeholders, as well as private sector representatives, industry associations, scientific community and locally civil society groups is equally vital.
Third, implementation of many climate change actions and commitments is not possible without setting national budget allocations for the implementation of sectoral and local NDC targets. The better national budgeting—including of climate funds—as well as wider engagement of national financial institutions, central and development banks, as well as private sector, the more chances exist for implementing NDCs and raising ambition in their updates. For instance, climate funds that can be replenished from establishing of carbon pricing and phasing-out fossil fuel subsidies, thus enabling the use of carbon pricing instruments. When efficiently collected, revenue from a carbon pricing can be channelled back into the economy through specific instruments known as ‘hypothecation’, it can supply budget liquidity to stimulate green economic recovery from post-COVID-19. The introduction of such instruments will provide the means for the governments to reduce inequality and poverty, while progressing emissions reduction targets. In contrast, if there are no mechanisms to generate or recycle revenue from the carbon pricing policy, progress towards emissions reduction targets could entail both economic and social costs and will become unpopular. Moreover, the more concrete the budgetary planning, the higher are the credit ratings of different countries, which increased the options to gain access to new climate financing from multilateral and bilateral donors.
At the core are well developed monitoring, reporting and evaluation systems (MRVs), which are central to NDC implementation. As the saying goes, ‘you cannot manage what you do not measure’. At the COP26 it was underlined that well developed MRV systems are at the centre of well-functioning Enhanced Transparency Framework—the pillar of the Paris Agreement implementation.
So how well as those four enabling factors developed in the Asia-Pacific region? Are Asian and Pacific countries very behind on these enablers, and does this explain why their collective ambition is so muted?
Although every country is different, the perhaps surprising fact is that the vast majority of countries in the region have more than basic measures in place to mainstream NDCs, and are in principle prepared and capable to initiate NDC implementation and have a good basis for a more ambitious NDC review and updates. Even better, over 90 per cent of countries in the Asia-Pacific region are taking action on increasing their climate finance readiness based on a number of proxy indicators. Between 20 and 53 per cent of the region appear to be operating effectively on climate finance to be able to scale up climate action.
On the other hand, very few countries in the region—up to 10 per cent are coordinating sufficiently to perform effectively, with all these countries being relatively high income—Australia, Japan, South Korea and New Zealand. Between 43 and 53 per cent are ‘engaged’—meaning they are still laying the foundations for coordination of NDC actions, but more can be done.
And perhaps the most challenging, based on the data, around 40–43 per cent of the countries in the region have only made the basic steps to effectively comply with transparency frameworks under the UNFCCC, and no country is really delivering the best monitoring and reporting that is needed, even the high-income countries.
This mixed picture in terms of enabling raises the question of whether the enabling factors and ambition levels are perhaps correlated with income.
With a closer analysis of the data, this hypothesis of linear relationships between income, and even other possible explanatory factors such as population or current emissions, versus ambition and enabling is unclear. For instance, income only explains 4 per cent of the variation in ambition scores. Similarly, income only explains 5 per cent of the variation in the enabling scores, that is, the evidence does not suggest that a richer country will create more enabling conditions or a poorer one will have fewer enabling conditions.
Furthermore, the correlation between enabling factors and ambition reveals an interesting outcome. There are 19 countries in the region, including Solomon Islands, Kazakhstan and the Republic of Korea, that can be described as ‘ambitious’, relative to their enabling factors. Other countries, including Singapore, India, China and Indonesia, that have very solid enabling conditions, yet demonstrate somewhat insufficient ambition relative to these conditions, and should consider exploring their potential for increasing climate mitigation and adaptation commitments, while setting a good example for other countries in the region. That said, the majority of countries in the region—at all levels of income—still need to work on increasing the enabling factors to drive up more ambition.
Finally, well-developed enabling factors such as MRV systems and institutional coordination support climate finance readiness, and further enhance confidence for higher climate action ambition.
4. A path that requires decisive action, both post-COVID-19 and post-COP26
The findings from this analysis generally underscore that while countries have not yet submitted NDCs that have sufficient ambition, many countries are ready for NDC implementation and are in principle ready to increase ambition.
So why has not this happened? Even at COP26, only a few new commitments from the region were made. The varied experience of COVID-19 management practices in the region provides some clues. When the first wave of COVID-19 arrived, the majority of governments across the Asia and Pacific region responded fast and decisively—in particular shutting down parts of the economy in order to slow the spread of the virus, increasing health expenditure, and providing socio-economic measures to support businesses and citizens. By the end of 2020, Asian and Pacific countries had introduced a total of 329 policies and measures to support people and workers and spent an average of 7% of GDP in each country on the overall COVID-19 response in 2020. With the development of vaccines, these expenditures have only risen in 2021.
There is a practical rationale to link COVID-19 policies to green growth policies—to create a ‘green recovery’. For instance, as mentioned earlier, fossil-fuel subsidy reform is a key practical policy area for overlap between COVID-19 policy and climate change action. Subsidies can take up a great deal of budgetary space, which can be directed towards health or other social support. Similarly, there are significant benefits of linking E-mobility with COVID-19 responses. Due to lockdown and health-related measures, COVID-19 requires mobility restrictions were introduce, which translated into cuts in demand for the use of private and public transport. Some countries have encouraged greener forms of personal transport, such as bikes, and hybrid/electric bikes and cars, to avoid COVID-19. In addition, as far as the movement of goods has been concerned, some countries have encouraged the use of rail rather than trucks to reduce COVID-19 risks. An accessible and well-functioning water supply and waste management sectors are also essential to dealing with both climate change and COVID-19 management issues.
Yet, many post-COVID-19 actions were not at all aligned with climate change action or with NDC targets specifically. Of the ‘green recovery’ policies introduced across the region during 2020—a total of 111 new policies—only 59 per cent of these were previously included in the countries’ NDCs. The rest were entirely newly conceived, suggesting NDCs in the region could have been more ambitious previously. Furthermore, during 2020, 15 countries in the region did not introduce any ‘green recovery’ policies for the energy sector, despite this sector accounting for the majority of carbon emissions for most countries in the region. Additionally, 53 per cent of Asia-Pacific countries did not implement any green recovery policies for their transport or tourism sectors in 2020Footnote 10.
Why not? The answer could be too little time to coordinate. It could also be that decisiveness when it came to COVID-19 was initially paramount. It is high time for the Asia-Pacific region to move out of the policy space for emergency response and start developing long-term low carbon development trajectories.
So, what is next for the Asia-Pacific region?
5. Four gaps to fill
When we consider the key outcomes of COP26, to which all UNFCCC parties agreed, the following clear opportunities emerge:
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1. Asia-Pacific countries need to both firmly (unconditionally) commit to implementing the already defined greenhouse gas emissions reductions targets in the current NDCs and carbon neutrality pledges, and boldly enhance those commitments in 2022.
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2. While building on lessons from COVID-19, Asia-Pacific countries need to accelerate the phase-down of unabated coal and inefficient fossil fuel subsidies, and in particular major Asia-Pacific emitters.Footnote 11
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3. Based on the agreed rules of carbon offset markets (Article 6 of Paris Agreement), Asia-Pacific countries need to begin actively using carbon pricing instruments and further enhance reporting and transparency on national and sectoral emissions (MRV) to create a basis for investments in low carbon and clean industries, and nature-based solutions for adaptation and mitigation.
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4. All countries in the region need to better understand and share what raised ambition levels and actions would look like, and how these are economically and developmentally sound, and share best practices to stimulate decisive climate action by all.
While supporting Asia-Pacific countries in advancing readiness across the four enabling categories of mainstreaming, coordination arrangements, resource mobilisation as well as monitoring and reporting of climate action is imperative for the region, the fact is, countries need to act now. Sub-regional and regional cooperation offers a good opportunity for equalising the level of the playing field and creating a mutually supportive atmosphere in the true spirit of multilateral solidarity. The countries that are ahead of others in their sub-regions would benefit from sharing experience and supporting those who are lagging, since climate change and its impact do not know boundaries. The time is now, there is no time to waste.
