Investing in Clean Technologies

Photo by J. Wainwright

It is my pleasure to present to you the premier edition of Development Asia, a magazine that focuses on issues of critical importance to Asia and the Pacific.

Climate change is one such issue, and the focus of this edition. While obviously a matter of grave concern throughout the world, climate change holds specific implications for Asia, where greenhouse gas (GHG) emissions are rising dramatically. It is expected that by 2030, Asia will account for 30% of the world’s energy use and 42% of global GHG emissions. Thus, it is in this region that the global effort to reduce GHG emissions will be won or lost.

The Asia and Pacific region is also highly vulnerable to the already unavoidable impacts of climate change—with the poor expected to suffer earliest and most. The region must adapt to anticipated increases in floods, droughts, heat waves, severe storms, and other adverse impacts, lest these undermine recent development progress. Such impacts may also exacerbate the recently re-emerging food security concerns.

Reducing the region’s overall energy consumption is not an option, given that nearly 930 million people in Asia and the Pacific still do not have access to electricity. Add to this the demands of industry, and it becomes clear that huge investments are required in energy infrastructure and development. Asia will need an estimated $6.4 trillion in energy infrastructure investment by 2030, with more than half the investment directed toward electricity generation.

Collective action by governments and the private sector, backed by multilateral institutions, is essential to ensure that the bulk of such investments support clean technologies and other low-carbon options. Globally, public and private investments in clean energy, energy efficiency, and carbon alternatives reached almost $150 billion last year, a 60% jump on the previous year. Investment growth was strongest in North America and Europe, spurred by favorable policies and regulatory incentives.

Governments of Asia and the Pacific need to remove barriers and create the right environment for attracting a greater proportion of global investment in new, clean technologies. Policies and measures to stimulate such investment have been introduced in the People’s Republic of China, India, Malaysia, Pakistan, and Philippines, but more needs to be done.

The development of innovative financial instruments can also unlock greater volumes of investment from the world’s private capital markets to help finance the evolution of the clean energy sector in developing Asia. Multilateral development banks like the Asian Development Bank (ADB) can play an important role. ADB, for example, is implementing a wide range of risk mitigation instruments and structures to reduce the risk borne by private investors in new technologies. Similar innovation will be needed to find financing for climate change adaptation measures. We may also need to consider financing options for helping climate change refugees.

The Bali conference on climate change agreed on a roadmap leading to a global accord in Copenhagen in 2009. I am confident that continued attention to this critical issue, and ongoing efforts by all of us, will help ensure a healthier, more sustainable future for Asia, and for the world.

ADB is committed to increasing awareness of Asia’s development challenges and encouraging innovative solutions from around the globe. Development Asia is part of this effort. I would like to thank the contributors to this inaugural edition, and to encourage feedback from its readers. We look forward to bringing you informed, thoughtful news and views on the numerous other development challenges facing Asia and the Pacific in the months and years ahead.

Haruhiko Kuroda
President
Asian Development Bank

Analyzing Issues That Matter

Photo by Richie Abrina

Asia is one of the world’s most dynamic regions, marked by spectacular growth rates in countries whose economies are setting the pace for the rest of the globe. At the same time, wide swaths of Asia remain scarred by abject poverty and deep economic and social disparities, where 600 million people struggle to survive on $1 a day or less.

Asia is also one of the most varied regions of the world in other ways. From the mountains of Central Asia to the islands of the Pacific, people face a host of challenges in different ways, under a variety of political and economic systems.

And yet, across Asia, people share the same hopes for peace, prosperity, and progress that underlie the idea of human development. Experiences can be shared, successes replicated across countries, and common solutions forged to problems—such as climate change—that threaten people everywhere.

Development Asia aims to make a significant contribution to raising awareness and understanding of the issues that matter most today. It is not an academic journal; nor is it a publication that presents the views of the Asian Development Bank. It is intended as a forum for debate and discussion, reflecting different views of the most topical and complex development issues in the region.

In this launch issue, we focus on four such issues: climate change, biofuels, genetically modified foods, and food security. Our cover story features a candid interview with Rajendra Pachauri, chair of the Nobel Peace Prize-winning UN Intergovernmental Panel on Climate Change, who shares his views on the impact of climate change and the role of development institutions in addressing the problem.

In guest columns, two pre-eminent experts on the subject suggest ways of dealing with climate change. Lord Nicholas Stern, author of the Stern Review on the Economics of Climate Change, says global action to reduce greenhouse gas emissions must satisfy the principles of effectiveness, efficiency, and equity. Emil Salim, adviser to the Indonesian president, calls for a sustainable development model for Asia that eradicates poverty while fighting climate change.

We ask whether biofuels are the panacea for the world’s energy problems or if they pose a threat to longer-term environmental sustainability. We look at genetically modified foods and whether they really hold the key to eradicating global hunger. We also consider the impact of soaring food prices on the poor and the need for agricultural reforms.

Also, in this twice-yearly magazine, you will find sophisticated but accessible analyses of issues, and reportage that goes beyond the standard jargon and rhetoric of development work. The articles are the work of independent contributors—reputed journalists with an understanding of the Asia and Pacific region—presented with a premium on objectivity, balance, and accuracy. Besides interviews and opinion pieces from top experts in their fields, we also bring you news, reviews, and development highlights from across the region.

We hope you will enjoy Development Asia and that it will enrich and inform your perspective on the opportunities and challenges facing the Asia and Pacific region. We welcome your views on Development Asia and what you would like to see in future issues. Address your letters to the editor, and e-mail devasia@adb.org. Visit us on the Web at www.developmentasia.org.

Ann Quon
Publisher