1. To better help Southeast Asian markets track their decarbonization progress, the report unveiled the region’s first SEA Green Economy Index which examines how each country is progressing across five metrics with varying weightage totaling 100% – ambition (20%), progress (25%), roadmap (20%), accelerator (25%), and investment (10%).
2. “The index helps provide an objective snapshot of how each country is performing year-on-year and relative to peers. It shows an overview of areas they are doing well and recognizes where progress is being made. It is important to note that this index is constantly evolving as the region continues to tweak initiatives to fit respective markets’ needs,” said Hardcastle.
3. The index shows that Southeast Asia has made some encouraging moves to reduce greenhouse gas emissions, with Singapore and Vietnam making the most progress over the last year. Eight out of 10 countries have net zero targets, and while they have remained the same as the previous year, more than half of the region’s top emitting corporates have set net zero or emission reduction targets, 15 more compared to 2023. In addition, seven countries have shown progress in adopting renewable energy and electric vehicles, preserving forestland, and enhancing health of cropland soil.
4. Translating ambition to action and results will take time. Southeast Asia is still in early adoption and has the opportunity to capture proven and the most cost effective decarbonization initiatives. In 2024, the region needs to double down on the top 13 investable ideas, leverage on the key accelerators to unlock these ideas and ensure better cooperation among governments, corporates, and investors.
GREEN ECONOMY INDEX
1. For the first time since the report’s first iteration in 2020, it ranked the decarbonisation progress of the 10 Southeast Asian countries by assessing metrics such as targets set, regulatory framework, net zero roadmaps and emission levels.
2. Vietnam had made the biggest progress, in 2023, with its overall score going up by five points to 38. Setting a national net zero roadmap was the biggest contribution to its improved scoring.
3. Singapore’s score improved by four points to 55. The city-state was top of the index overall.
4. Malaysia came in second at 43 points, with Indonesia closely behind at 41 points.
5. As a whole, the region has made progress with more countries establishing roadmaps and companies setting net zero targets, according to the report. Almost all countries are experiencing a steady reduction in deforestation.
6. But solar and wind energy generation capacity still remains low at four per cent and is not increasing fast enough.
7. While there is significant progress in defining what needs to be done, the “how” is still unclear due to insufficient regulations and incentives to facilitate the implementation of plans.
8. Given the lack of time to deliver its 2030 net zero commitments, the report highlighted the urgency for Southeast Asia to seize the opportunities arising out of the green economy transition.
9. The first few steps are already known and achievable, as no new technologies or solutions are required for Southeast Asia to decarbonise since it is still at the early stages of the energy transition.
10. Southeast Asia could also emerge as the centre for green exports, markets and investments, amid geopolitical tensions between the United States, the European Union, and China as each power bloc seeks to influence the pace of decarbonisation.
Source:
https://www.bain.com/about/media-center/press-releases/sea/southeast-asias-green-economy-2024/#:~:text=To%20better%20help%20Southeast%20Asian,%2C%20accelerator%20(25%25)%2C%20and
https://www.edb.gov.sg/en/business-insights/insights/green-investments-in-asean-rise-20-to-us-6-3-billion-in-2023-bain-temasek-report.html
