Southeast Asia

NEW! Khor Reports' PolTracker: Malaysia—1 Sep 2021

Debuting under our brand new—and long in the making—Products page, Khor Reports is proud to present our first PolTrackers report on the Malaysian political economy scene!

The [SAMPLE] Poltracker: Malaysia—1 Sep 2021 tracks hot topics and themes relevant to the Southeast Asian nation based on data obtained from social media and human-sourced intel. The 6–8 paged briefing includes: (1) questions about Prime Minister Ismail Sabri’s taking over for an embattled Muhyiddin; (2) Twitter Malaysia, e.g. hashtag protests and netizen reaction to the “new” cabinet; (3) eye on the opposition response, e.g. Mahathir's Council or Muhyiddin reform deal; (4) Covid worries persist; and (5) a Q&A session, including a 20-min session for subscribers.

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The IPCC Report on Climate Change: What does it mean for Southeast Asia?

Last week, the world was abuzz with the latest climate change assessment report by the Intergovernmental Panel on Climate Change (IPCC), and for good reason: for the first time ever, the IPCC is unequivocally holding humans to blame for the 1.5°C increase in global temperature, which would inevitably occur by 2040. The near 4,000 paged-report makes abundantly clear the damage human-driven activities have caused to the environment, as well as the impacts consequent of those actions. It also makes it clear that no place on earth is spared from the effects of a rising global temperature.

Chapter 3 of the IPCC report details the emergence and intensity of climate change related events by region under different situations of global warming. For Southeast Asia, three key events were identified: (1) flooding due to sea level rise; (2) precipitation events; (3) and crop yield.

Sea level rise and coastal flooding

Global average sea level is estimated to rise between 0.26–0.77 metres by the end of the 21st century if global warming is limited to 1.5°C; in comparison, a 2°C increase in global temperature would mean an addition of about 0.1 metres. In either case, the Southeast Asian region is projected to be one of the most at risk of coastal flooding, assuming that there are no improvements made to existing protection levels. Interestingly, one of the studies (Clark et al., 2016) referenced in the report identified Indonesia and Thailand as countries with a population count of above 50 million facing a particularly high risk of coastal flooding.

That being said, this news of sea level rise is nothing new—similar projections have been made time and again, supplemented by interactives maps by organisations such as NASA and Climate Central. All of them arrive at the same conclusion: coastal flooding is fast becoming an increasingly huge problem, and how much damage can be contained is heavily dependant on how much global warming can be limited. A Greenpeace report recently estimated that by 2030, rising sea levels would leave 15 million people across seven major East and Southeast Asian cities vulnerable to flooding, along with a projected cumulative economic damage of about USD724 billion.

Precipitation events

In the previous IPCC report published in 2018, it was found that the ratio of rainfall during the wet season to dry season throughout Southeast Asia has generally increased between 1955 and 2005. The frequency of extreme precipitation events, i.e. days with precipitation comprising the top 1% of all days with precipitation, in most of the northern parts of the region was also noted to have increased, with the Malay Peninsula experiencing more intense rainfall throughout the northeast and southeast monsoons. Accordingly, the 2018 report projected a continued rise in extreme precipitation events associated with monsoons for the Southeast Asian region.

Three years later, the projection remains fundamentally unchanged. Southeast Asia is projected to record an increase in heavy precipitation events for both global warming of 1.5°C and of 2°C; the latter is expected to result in a stronger and statistically significant increase than the former.

“[The monsoon] brings heavy rains that are crucial for agrarian economies in the area. But monsoons in the recent years have increasingly brought devastating floods… Instead of more constant, less-intense rains, torrential downpours are now more frequent.”

Crop yield and food security

The Southeast Asian region has been identified to be highly vulnerable to food security risks based on its heavy dependence on maize, rice and, wheat. While lower yield and reduced nutritional quality of these cereal crops are expected as global temperature rises, these negative effects are projected to be smaller if global warming is limited to 1.5°C instead of 2°C.

Photo: Milo Weiler/Unsplash. The Mekong River plays an indispensable role in the economies of multiple countries. It is estimated that fisheries in the Lower Mekong Basin alone generate USD17 billion a year, comprising 3% of the combined GDP of Cambodia, Laos, Thailand, and Vietnam (The Diplomat, 2016).

Photo: Milo Weiler/Unsplash. The Mekong River plays an indispensable role in the economies of multiple countries. It is estimated that fisheries in the Lower Mekong Basin alone generate USD17 billion a year, comprising 3% of the combined GDP of Cambodia, Laos, Thailand, and Vietnam (The Diplomat, 2016).

Regardless of either situation, the measures necessary for a nation to adapt to a warmer world in order to safeguard its food security remains highly complex. In this case, the Mekong river basin makes for a useful illustration—it is a hotspot for a myriad of climate-associated risks, namely higher temperatures and precipitation, flooding, and saline intrusion, i.e. flow of sea water into an area not typically exposed to high levels saltwater. All these risks lead to a domino effect posing different challenges: hotter climate, more floods, and saltier waters mean less fertile soil and unsuitable habitats for terrain and marine life (see also: Marine species increasingly can’t live at equator due to global heating), which in turn mean lower agricultural productivity, which in turn significantly disrupts farming and fishing activities at the Mekong river.

SIIA Haze Outlook 2021: Opportunities for Climate Action and Green Recovery

The SIIA Haze Outlook 2021, published last month and co-authored by the Singapore Institute of International Affairs (SIIA) and Segi Enam Advisors, has something a little different than last year’s report—a segment exploring opportunities for climate action and green recovery, with particular focus on nature-based solutions (NBS) and carbon markets.

Theoretically, nature-based projects could lead to carbon emissions reduction and carbon offsets, while providing opportunities for investments. While the sector is still in its early stages of development, interest in carbon credits generated form Indonesia-based NBS projects is growing. The Katingan Mentaya Project managed by PT Rimba Makmur Utama illustrates this interest—a forest restoration and protection initiative located in Central Kalimantan, it generates an average of 7.5 million triple gold certified carbon credits a year, and carbon credits generated from the project have already been purchased by major global multinational firms.

Accordingly, many plantation companies that spoke to SIIA have expressed some interest in generating carbon credits from their own conservation projects, both current and future. Ultimately however, it is still too early to assess how willing project developers are to sell credits internationally compared to domestically.

Our previous posts on the SIIA Haze Outlook 2021: (1) Reviewing 2020; and (2) Issues to Watch in 2021

Read the full report here: SIIA Haze Outlook 2021

SIIA Haze Outlook 2021: Issues to Watch in 2021

Continuing from previous posts on SIIA’s Haze Outlook 2021, of which Segi Enam was the co-authors, there are several relevant issues that bear watching in 2021.

On the meteorological front, Indonesia is expected to enter into its usual June–September dry season following a wet spell that was in large part caused by La Niña. Meteorological departments generally expected this dry season to either remain normal or drier than it was in 2020 but much less so than the droughts in 2015 and 2019. Both the Indian Ocean Dipole and El Niño-Southern Oscillation phenomena are forecasted to stay neutral throughout the third quarter of 2021. Overall, however, meteorologists warn that there are still some uncertainty in these forecasts, since it is difficult to make predictions during the transition seasons from April to May.

Given the favourable weather conditions, policy and human factors become decidedly important in the evaluating the risk of a severe transboundary haze. On one hand, the relevant policies in effect are sending a strong message of commitment to sustainability on the part of the Indonesian government, particularly in the areas of peatland and mangrove conservation, net zero emission goals, and haze prevention in the midst of the pandemic. On the other, there are concerns that the more recent policies, namely the Omnibus Law and food estate programme, would leave adverse environmental consequences.

Source: Segi Enam Advisors based on data from The World Bank (2021) for palm oil and rubber prices, GFW (2021) for tree cover loss and primary forest loss, KLHK (n.d.) and KLHK (2017) for official estimated burned area in 2015, 2019, and 2020.

Source: Segi Enam Advisors based on data from The World Bank (2021) for palm oil and rubber prices, GFW (2021) for tree cover loss and primary forest loss, KLHK (n.d.) and KLHK (2017) for official estimated burned area in 2015, 2019, and 2020.

That being said, there are other factors that bear watching. The Covid-19 pandemic is the most obvious; while it has presently not resulted in a severe haze incident despite the disruptions it has caused to fire management efforts, its impact in 2021 and beyond remains unclear. What the pandemic has caused is a near multi-year high in prices within the agricultural commodity market, which in turn raises the question of whether it would drive Indonesia growers to carry out land clearing and replanting activities.

Read the full report here: SIIA Haze Report 2021