BEIJING: President Xi Jinping will host a two-day summit with the leaders of five Central Asian nations next week, Beijing said on Monday (May 8), as China moves to increase its influence in the region. Leaders of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan are expected to attend the China-Central AsiaContinue Reading
SINGAPORE: Subdividing Certificates of Entitlement (COE) categories may result in more volatile prices, said Transport Minister S Iswaran on Sunday (May 7).
This comes after suggestions from dealers and buyers to split Category D, which is for motorcycles, separating luxury bikes from the rest.
“The more you subdivide the COE categories, the smaller the supply for each category,” said Mr Iswaran on the sidelines of the official opening of a new integrated community services centre, Jampacked@West Coast.
“Therefore, the more volatile the price will become because basically, you have a smaller supply and all you need is a small increase in demand, and the price will go up significantly and vice versa.”
Last month, the Land Transport Authority (LTA) announced changes to “improve allocation efficiency”.
Among the new measures implemented, LTA increased the bid deposit for motorcycles to S$1,500 (US$1,132) from S$800.
At the same time, the validity period for motorcycle temporary COEs was cut from three months to one month.
In the latest bidding exercise on May 4, which was the first tender involving new measures for Category D, premiums for motorcycle COEs plunged nearly 60 per cent.
Speaking to reporters during a media doorstop, Mr Iswaran said the latest set of measures aims to minimise speculation and improve the overall functioning of the market, but added that it is difficult to predict future prices.
“We’ve seen the result of one bidding exercise after the changes that have taken place so I think we should let the market work itself,” he said.
“Don’t be premature and draw any conclusions at this juncture.”
If there is a need for any further moves, the Government will consider that at the appropriate time, he added.
Turning to a question from the media about whether a similar approach would help to bring COE prices for cars down, he pointed out that the mechanism for securing car COEs is different from motorcycles.
“In the case of Cat D, dealers bid and secure the COEs, they hold them before they onsell a motorcycle with the COE to a buyer, whereas in the case of cars, it is a different kind of mechanism because typically, the dealers bid in the name of the buyer,” he said.
“Having said that, we are studying this,” he added.
“We have always been ready to make refinements and adjustments in response to material developments in the market and it’s no different at this point in time.”
Prices for cars in Category A and B broke records for the third consecutive tender in April, closing at S$103,721 and S$118,501 respectively.
While both closed lower in the latest bidding exercise in May, they remain above S$100,000.
Mr Iswaran is scheduled to deliver a ministerial statement on meeting the transport need of Singaporeans in the next Parliament sitting, which begins tomorrow.
AFPAt least 30 people have been killed in ethnic clashes in the remote Indian state of Manipur, officials say.
The violence began earlier this week after a rally by indigenous communities against moves to grant tribal status to the main ethnic group in the state.
Mobs attacked homes, vehicles, churches, and temples. Some reports put the death toll as high as 54.
Around 10,000 people have reportedly been displaced. Thousands of troops have been sent in to maintain order.
A curfew is in place in several districts and internet access has been suspended.
Neighbouring states have begun evacuating their students from Manipur, which is in India’s northeast and close to the border with Myanmar.
The army says it is bringing the situation under control but the Hindu-nationalist BJP-led government in the state has been accused of not doing enough to prevent the violence.
Members of the Meitei community, who account for at least 50% of the state’s population, have been demanding inclusion under the Scheduled Tribe category for years.
India reserves government jobs, college admissions and elected seats at all levels of government for communities under this category to rectify historical wrongs that have denied them equal opportunities.
This status would give the Meiteis access to forest lands and guarantee them a proportion of government jobs and places in educational institutions.
Other tribes are worried that they may lose control over their ancestral forest dwellings.
On Tuesday, thousands of tribal people from the hill districts of the state participated in a march called by the All Tribal Students Union of Manipur to oppose the demand.
A day later, a similar rally turned violent, sparking unrest in other districts that has since spread.
Google, Line trumpet efforts to curb misinformation
Tech giant Google has launched new tools for Thailand’s upcoming general election, while LINE Thailand suggests politicians use their “Official Accounts” to communicate with voters.
The moves aim to tackle misinformation.
Saranee Boonritthongchai, country marketing manager at Google Thailand, said that in the lead-up to the election, the company understands that Thais need helpful and relevant information to help them make decisions.
The company recently launched a Google Trends Thailand General Election page to make it easier for the media and public to find search trends related to political campaigns.
“We’ve focused our efforts on supporting the 52 million Thais who are expected to cast their vote and more than 3 million first-time voters in the election this year by helping them connect to useful and relevant election-related information online, ensuring that our products offer unbiased, authoritative and timely information,” she said.
“To curb misinformation at the source, we also trained and engaged journalists and newsrooms on reporting authoritative and credible news ahead of the election cycle.”
The policies of Google Ads and YouTube’s Community Guidelines help ensure that everyone understands digital best practices and their responsibilities during elections, said Ms Saranee. Google has policies governing misinformation related to elections, Covid-19 and vaccines across its platforms.
Mukpim Anantachai, head of YouTube partnerships for Thailand and Vietnam, said election integrity is a priority for the company and it has been working to ensure the right policies and systems are in place to support the election.
As well as connecting people to authoritative and quality information, YouTube removes content that violates its standards in a timely manner with the help of machine learning and trained content reviewers. Its goal is to maintain a balance between protecting the community from harm and enabling a diversity of viewpoints to thrive on YouTube, said Ms Mukpim.
In the fourth quarter of 2022, content that violated guidelines comprised 0.09% to 0.11% of views on YouTube. More than 5.6 million videos and 6.4 million channels were removed for violating YouTube’s Community Guidelines. Of these, more than 69,000 videos from Thailand were removed.
In related news, LINE Thailand recommends political parties and candidates use its verified Official Accounts (OA) to communicate with the electorate.
LINE OA messages generated by political parties or candidates are labelled in the politics category. Advertising campaigns on Line Ads are available, assuming messages comply with the laws and regulations of the Election Commission.
Along with UPS and DHL, FedEx Corp., one of the three largest express package delivery business, reportedly plans to relocate its Asia-Pacific regional offices from Hong Kong and nbsp to Singapore in order to” achieve greater speed and agility.”
According to Bloomberg, Kawal Preet, the local president of FedEx Express, will relocate to Singapore in September. Other Hong Kong-based executives will also relocate there, according to an unnamed staff member.
In an email cited by Bloomberg, the American courier claimed that it could more quickly and easily connect its operations in the Asia Pacific, Middle East, and Africa( AMEA ) in Singapore. While retaining a” significant” presence and leadership roles in the special & nbsp, administrative region, it stated that fewer than 15 % of its positions in Hong Kong will relocate to Singapore. & nbsp,
According to the organization, some positions that don’t need to be located in the offices city may be moved to Malaysia or India to cut costs. & nbsp,
Given that Sino-US social tensions are rising, commentators claimed that some foreign businesses are leaving Hong Kong because they are unsure whether they will one day become the target of Chinese regional security investigations or secondary sanctions from the US.
Chau Sze – tat, a political commentator from Hong Kong, writes in his YouTube channel,” The transfer of FedEx’s regional offices deals briskly to the city, which usually highlights its status as an international logistics hub.” The business relocates its top executives to Singapore, demonstrating that it no longer values Hong Kong as a major logistical hotspot for the region.
According to Chau, the authorities could always hold the pandemic responsible for the absences of foreign businesses in Hong Kong over the past three years. However, it demonstrates that Hong Kong’s long-term business environment has deteriorated if they are still leaving the city after all Covid standards have expired. Concerned about the National Security Law are some international businesses.
He claims that FedEx’s investigation by the Chinese authorities in 2019 for withholding Huawei Technologies’ packages may have played a role in the US courier company moving its regional offices. & nbsp,
After the British mail mysteriously diverted two packages intended for Huawei headquarters in China to the US and tried to divert two persons, Huawei announced on May 27 that it was reviewing its partnership with FedEx. The next day, FedEx expressed regret for handling Huawei’s packages improperly and claimed that no outside difficulty had caused it to request transhipment. & nbsp,
The Chinese government announced earlier in June 2019 that it was looking into FedEx in response to a complaint Huawei had made about misrouted packages. Later, in late July, it was reported that FedEx may have delayed the delivery of more than 100 items to Huawei. & nbsp,
Socially private, the incident occurred after Huawei Chief Financial Officer Meng Wanzhou was detained in Canada in December 2018 on suspicion of breaking US punishment. Following a formal arrangement with the US court, Meng was released in September 2021.
After anti-extradition protests broke out in Hong Kong in June 2019, Sino-US hostilities had increased. According to the Foreign foreign ministry, Todd Hohn, a FedEx Express aircraft and retired US Air Force commander, was detained on September 12 at the Guangzhou Baiyun International Airport and nbsp for leaving with an air gun pellet package. He was given parole, but smuggling ammunition was the subject of an investigation.
On June 27, 2020, Hohn was given permission to leave Guangzhou, just a few times before Beijing enacted the National Security Law in Hong Kong on June 30. & nbsp,
In an interview with HK01.com in December 2020, managing director Anthony & nbsp, Leung of Express Hong Kong and Macau expressed his confidence in his ability to manage the express business there in spite of the unstable global environment.
Leung described Hong Kong’s market climate as an international financial hub with many benefits, such as a prime area, no tariffs, and straightforward customs procedures. He declared that FedEx would have its top operations and support staff based in Hong Kong, where it has its Asia Pacific headquarters.
However, FedEx began moving its Hong Kong-based planes to San Francisco in January 2021, claiming that the Asian financial capital’s stringent Covid regulations were having an impact on its operations. It announced that it would close its team center in the neighborhood in November 2021. & nbsp,
Despite the fact that Hong Kong repealed all of its anti-epidemic regulations in late 2022, some critics claim that the worsening US-China relations continue to pose operational risks for international businesses based there.
Five Chinese businesses, including one in Hong Kong, were sanctioned by the US in February of this year for allegedly offering goods and services to the Russian army. It sanctioned 12 Taiwanese companies last quarter, the majority of which were based in Shenzhen, for sending electronic components from Hong Kong to Russia.
Additionally, according to Chief Executive John Lee, Hong Kong will pass other national security policy by the end of 2024 in accordance with the Basic Law’s Article 23. & nbsp,
The current National Security Law deals with crimes like independence, terrorism, corruption of the government, and cooperation with foreign power. The new legislation will focus on spying activities as well as treason, sedition, theft of state secrets, and & nbsp. & nbsp,
Study: New Sino-US tensions are sparked by the Fentanyl and Russia industry.
@ jeffpao3 Follow Jeff Pao on Twitter at & nbsp.
BEIJING: Chinese Foreign Minister Qin Gang assured his Russian and Indian counterparts of deepening bilateral ties, promising that “coordination and cooperation” will only grow stronger, in a show of solidarity with two of China’s biggest neighbours. Qin met in India on Thursday (May 4) with other foreign ministers of theContinue Reading
The People’s Liberation Army (PLA) has deployed at least 57 warplanes, 19 naval vessels and a military drone to the Taiwan Strait in a fresh eruption of anger over reports the United States is seeking to produce weapons on Taiwan.
Taiwan’s Ministry of National Defense said that, in the three-day period leading up to Thursday morning, 19 Chinese warplanes had flown across the Taiwan Strait median line. The ministry is closely monitoring the actions of the Chinese army, it said, and will announce at 6 am Friday Taiwan-time an updated count of the sorties involved.
The incidents happened as 25 US defense contractors attended the Taiwan-US Defense Industry Forum in Taipei on Wednesday morning.
Steven Rudder, a retired United States Marine lieutenant general, said during the forum that he and the group of American defense contractors “have been on a mission to have a shared vision of a free, open, resilient, and inclusive relationship not only between the US and Taiwan, but also for the region.”
“Some US defense contractors are considering including Taiwan in their supply chains,” said Julian Kuo, a Taiwanese political scientist and a former member of the Legislative Yuan. “Although it may not involve any transfer of high technology, it is possible that Taiwanese firms will produce ammunition for US firms.”
Kuo said that, with Japan planning to add more than a hundred fuel and munitions depots on the Ryukyu Islands, the US may also establish tens of arms factories in Taiwan. He said such a plan is necessary because it will be difficult to transport ammunition from the Philippines to Taiwan once a war breaks out in the Taiwan Strait.
He said Taiwanese firms lack the experience of designing weapons but they are capable of producing parts for US weapon makers.
On Wednesday, the China Daily, an English newspaper owned by the Central Propaganda Department of the Chinese Communist Party (CCP), published an editorial titled, “US ups the ante in dirty game but should be forewarned.”
The Chinese version of the editorial was republished by other state media on Thursday with a headline “It is a dangerous step if the US produces weapons in Taiwan.”
“US officials have arranged for a delegation of 25 arms dealers to visit Taiwan from Tuesday apparently to explore the possibility of manufacturing weapons, mainly drones and ammunition, on the island, and ostensibly to support its secessionist-minded leader Tsai Ing-wen’s pro-independence agenda,” writes the author of the article.
“By constantly supplying weapons to Ukraine, the US has failed to deliver weapons to Taiwan on schedule,” he says. “By manufacturing weapons in Taiwan, the US arms dealers as well as the US administration can bypass a lot of problems to sell arms to the island.”
He says the US has crossed a line and that its moves pose a grave challenge to China’s sovereignty and territorial integrity. By allowing the US arms dealer delegation to visit Taiwan, the Biden administration is “playing with fire” and will ultimately burn itself, he says further.
He adds that the nasty American behavior could change cross-Strait relations or Sino-US ties forever.
In March 2019, Taiwan ordered four MQ-9B SkyGuardian drones from General Atomics Aeronautical Systems (GA-ASI) for about US$600 million. The US State Department approved the deal in November 2020.
The deal may have grown smaller in the interim and the drones in question seem to have been changed from the SkyGuardian to a more specifically maritime-oriented plane. Defense Post reported on Tuesday that the US Air Force had ordered four MQ-9B SeaGuardians for Taiwan but the order’s size was capped at $217.6 million. The manufacturer describes the SeaGuardian model as a “maritime patrol and reconnaissance aircraft.” The GA-ASI will also supply Taipei with two ground control stations, spare parts and other support equipment.
Lee Shih-Chiang, head of the Taiwanese Defence Ministry’s Department of Strategic Planning, said Thursday that the four drones will be completed in 2025 but the following six months of training will be conducted in the US, instead of Taiwan, due to cost concerns.
Tsao Chin-ping, general officer of Taiwan Air Force, said all the four drones and related equipment will arrive in Taiwan by 2027 and be ready for use six months later.
Taiwan’s Defence Minister Chiu Kuo-cheng said Taiwan ordered 66 units of F-16V fighters from Lockheed Martin in the US but the delivery of the first batch of the jets has been delayed to the third quarter of 2024 from the last quarter of this year as production was affected by the pandemic.
On February 7 this year, Taiwan’s National Chung-Shan Institute of Science and Technology (NCSIST) unveiled a series of domestically made attack drones, including one similar to the American AeroVironment Switchblade 300. The NCSIST said it has partnered with private companies to build prototypes of its drones but it did not name its partners.
Following an April 11 Japanese media report that 25 US defense contractors would send their representatives to Taiwan to discuss joint production of drones and ammunition. Taiwanese media reported on April 26 that Lockheed Martin, Raytheon Technologies and AeroVironment would be among the delegates.
“US arms dealers are accustomed to inciting confrontation and conflict and taking advantage of opportunities to make money from wars, and the US government is also accustomed to protecting them,” Zhu Fenglian, a spokesperson of the Taiwan Affairs Office of China’s State Council, said on April 26.
Zhu said that, over the past six years, the Democratic Progressive Party (DPP) had colluded with the US and recklessly purchased US weapons at high prices for a total of US$22 billion. She said Taiwan compatriots are now tied to the “Taiwan independence” chariot.
She said the DPP is not protecting Taiwan but harming and destroying it.
On the same day, the PLA sent a TB-001 military drone to fly around Taiwan. Taiwan said its Sky Bow anti-ballistic missiles at Chihhang Air Base were placed on full alert with some fighter jets taking off on April 27. On Wednesday of this week, China’s BZK-005 drone was seen flying around Taiwan.
Prior to this, China’s Ministry of Commerce said in February that it had added Lockheed Martin Corp and Raytheon Missiles & Defense to its “unreliable entities list” as they sold arms to Taiwan. It ordered the two firms to pay a combined fine of 99 billion yuan (US$14.4 billion) but it was ignored.
The ministry said last month that it had strengthened its curbs by banning the duo from having any trade with Chinese companies. It claimed that the two firms would suffer from failing to obtain Chinese parts and rare earth.
Read: Raytheon, Lockheed take a balloon war hit in China
Follow Jeff Pao on Twitter at @jeffpao3
WASHINGTON: Nicholas Burns, the US ambassador to China, stated on Tuesday, May 2, that China’s recent” punitive” actions against some US companies have caused Washington great concern, as well as the fact that international agencies are delaying projects in the nation because of concerns about its economic openness. Businesses haveContinue Reading
Three-month-old Tayabullah is quiet and motionless. His mother Nigar moves the oxygen pipe away from his nose and puts a finger below his nostrils to check if she can feel him breathing.
She begins to cry as she realises her son is fading.
At this hospital in Afghanistan, there is not a single working ventilator.
Mothers hold oxygen tubes near their babies’ noses because masks designed to fit their small faces are not available, and the women are trying to fill in for what trained staff or medical equipment should do.
Every day, 167 children die in Afghanistan from preventable diseases, according to the UN children’s fund Unicef – illnesses that could and should be cured with the right medication.
It is a staggering number. But it’s an estimate.
And when you step inside the paediatric ward of the main hospital in the western province of Ghor, you will be left wondering if that estimate is too low.
Multiple rooms are full of sick children, at least two in each bed, their little bodies ravaged by pneumonia. Just two nurses look after 60 children.
In one room, we saw at least two dozen babies who appeared to be in a serious condition. The children should have been continuously monitored in critical care – impossible at this hospital.
Yet, for the million people who live in Ghor, this basic facility is still the best equipped public hospital they can access.
Public healthcare in Afghanistan has never been adequate, and foreign money which almost entirely funded it was frozen in August 2021 when the Taliban seized power. Over the past 20 months, we have visited hospitals and clinics across this country, and witnessed them collapsing.
Now the Taliban’s recent ban on women working for NGOs means it’s becoming harder for humanitarian agencies to operate, putting even more children and babies at risk.
I’m also a mother, and when I saw the baby die, I felt like I’ve lost my own child
Already defeated by a lack of resources, medics at the Ghor hospital used whatever little they had to try to revive Tayabullah.
Dr Ahmad Samadi was called in to check his condition, fatigue and stress visible on his face. He put a stethoscope to Tayabullah’s chest – there was a faint heartbeat.
Nurse Edima Sultani rushed in with an oxygen pump. She put it over Tayabullah’s mouth, blowing air into it. Then Dr Samadi used his thumbs to perform compressions on the boy’s tiny chest.
Watching on looking stricken was Tayabullah’s grandfather Ghawsaddin. He told us his grandson was suffering from pneumonia and malnutrition.
“It took eight hours on rubble roads to bring him here from our district Charsadda,” Ghawsaddin said. The family, who can only afford to eat dry bread for meals, scraped together money to pay for the ride.
For half an hour, the efforts to revive his grandson continued. Nurse Sultani then turned towards Nigar and told her Tayabullah had died.
The sudden silence which had enveloped the room was broken by Nigar’s sobs. Her baby boy was wrapped in a blanket and handed over to Ghawsaddin. The family carried him home.
Tayabullah should be alive – every disease he had was curable.
“I’m also a mother and when I saw the baby die, I felt like I’ve lost my own child. When I saw his mother weeping, it broke my heart. It hurt my conscience,” said Nurse Sultani, who frequently does 24-hour shifts.
“We don’t have equipment and there is a lack of trained staff, especially female staff. When we are looking after so many in serious conditions, which child should we check on first? There’s nothing we can do but watch babies die.”
Minutes later, in the room next door, we saw another child in severe distress, with an oxygen mask on her face, struggling to breathe.
Two-year-old Gulbadan was born with a heart defect, a condition called patent ductus arteriosus. It was diagnosed six months ago at this hospital.
Doctors have told us the condition is not uncommon or hard to treat. But Ghor’s main hospital is not equipped to perform routine surgery that could fix it. It also doesn’t have the medicines she needs.
Gulbadan’s grandmother Afwa Gul held down her small arms, to try to prevent the little girl from pulling down her mask.
“We borrowed money to take her to Kabul, but we couldn’t afford surgery, so we had to bring her back,” she said. They approached an NGO to get financial help. Their details were registered but there’s been no response since then.
Gulbadan’s father Nawroze stroked her forehead, trying to soothe his daughter who winced with every breath she took. Stress etched on his face, he pursed his lips and let out a sigh of resignation. He told us Gulbadan had recently begun to talk, forming her first words, calling out to him and other members of their family.
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“I’m a labourer. I don’t have a stable income. If I had money, she would never have suffered this way. At this moment, I can’t even afford to buy one cup of tea,” he said.
I asked Dr Samadi how much oxygen Gulbadan needs.
“Two litres every minute,” he said. “When this cylinder gets empty, if we don’t find another one, she will die.”
When we went back later to check on Gulbadan, we were told that’s exactly what had happened. The oxygen cylinder had run out, and she died.
The oxygen production unit at the hospital isn’t able to produce sufficient oxygen because it only has power at night, and there isn’t a steady supply of raw material.
When this [oxygen] cylinder gets empty, if we don’t find another one, she will die
In a matter of a few hours, two children died of diseases that could have been prevented or cured. It’s a crushing but all too familiar blow for Dr Samadi and his colleagues.
“I feel exhaustion and agony. Every day we lose one or two beloved children of Ghor. We have almost got accustomed to it now,” he said.
Walking around the rooms, we saw an overwhelming number of children in distress. One-year-old Sajad’s breathing was raspy. He’s suffering from pneumonia and meningitis.
In another bed is Irfan. When his breathing became more laboured, his mother Zia-rah was given another oxygen pipe to hold near his nose.
Wiping tears that rolled down her cheeks with her upper arm, she carefully held both pipes as steady as she could. She told us she would have brought Irfan to the hospital at least four or five days earlier if the roads had not been blocked by snow.
So many simply can’t make it to hospital, and others choose not to stay once they get there.
“Ten days ago a child was brought here in a very critical condition,” Nurse Sultani said. “We gave him an injection, but we didn’t have the medicines to cure him.
“So his father decided to take him home. ‘If he has to die, let him die at home’,” he told me.
What we saw in Ghor raises serious questions about why public healthcare in Afghanistan is crumbling so quickly, when billions of dollars were poured into it by the international community for 20 years until 2021.
Where was that money spent, if a provincial hospital doesn’t have a single ventilator for its patients?
Currently there is a stop-gap arrangement in place. Because money can’t be given directly to the internationally unrecognised Taliban government, humanitarian agencies have stepped in to fund salaries of medical staff and the cost of medicines and food, that are just about keeping hospitals like the one in Ghor running.
Now, that funding, already sorely inefficient, could also be at risk. Aid agencies warn that their donors might cut back because the Taliban’s restrictions on women, including its ban on Afghan women working for the UN and NGOs, violates international laws.
Only 5% of the UN’s appeal for Afghanistan has been funded so far.
We drove up one of the hills near the Ghor hospital to a burial ground. There are no records or registers here, not even a caretaker. So it’s not possible to find out who the graves belong to, but it’s easy to distinguish big graves from small ones.
From what we saw, a disproportionate number – at least half – of the new graves belong to children. A man who lives in a house close by also told us most of those they are burying these days are children.
There may be no way to count how many children are dying, but there is evidence everywhere of the scale of the crisis.
Additional reporting by Imogen Anderson and Sanjay Ganguly
In terms of sustainable development goals (SDG), business and investment have long and difficult journeys ahead. Sobering figures from a draft report published by the United Nations (UN) last month reveal that at the end of 2022, just 12% of the SDGs were on track to meet their 2030 targets.
“It’s time to sound the alarm,” the report warned.
“At the mid-way point on our way to 2030, the SDGs are in deep trouble. A preliminary assessment of the roughly 140 targets with data show only about 12% are on track.”
“Close to half, though showing progress, are moderately or severely off track and some 30% have either seen no movement or have regressed below the 2015 baseline.”
The audience at FinanceAsia’s recent Sustainable Finance Asia Forum on April 18 heard that although there is plenty of road to make up on the journey to net zero, so too is there substantial opportunity.
ESG imperatives are changing the way institutional investors approach decision-making, develop sustainable products and operate within new regulatory frameworks.
While the over-arching message of the forum underlined that sustainable goals and driving yield are not inimical, how exactly institutions approach sustainable finance will shape the future.
The following are FA’s top five takeaways from a forum focussed on these frameworks.
***
1. Creativity is key
While sufficient capital may be out there to bootstrap transitional finance in Asia – a region that is bearing the physical brunt of climate change – getting it where it needs to go in emerging markets (EMs) is not working at the scale and speed necessary to effect change.
Emily Woodland, head of sustainable and transition solutions for APAC at BlackRock, told a forum panel exploring the state of play of Asia’s SDG commitments that, as well as climate and transition risks, investors also face the common-or-garden risks that come from operating in EMs.
“There are the general risks of operating in these markets as well – that’s everything from legal, to political, to regulatory to currency considerations,” she said.
“Where finance can help develop new approaches, is around alleviating risks to attract more private capital into these innovation markets, and this is where elements like blended finance come into play.”
To make emerging market projects bankable, de-risking tools are urgently needed.
“That means guarantees, insurance, first loss arrangements, technical assistance which can help bring these projects from being marginally bankable into the bankable space, offering the opportunity to set up a whole ecosystem in a particular market.”
2. Regulation drives change
As investment in sustainable development goals moves from the fringe to the mainstream, institutions are bringing with them experience and learnings that are accompanied by policy, regulation and clear frameworks from regional governments.
Institutions are being asked to lead mainstream investment in the space as increasingly, investment in ESG becomes a viable funding choice.
“The next phase, which is the forever phase, will be when sustainability becomes mandatory rather than just a choice,” Andrew Pidden, Global head of sustainable investments at DWS Group told the forum.
“In the future, you will not be able to make an investment that has not been subject to due diligence with a view to doing no harm – or at least to doing a lot less harm than it is going to supply.”
“People may think this is never going to happen, but people thought this phase (of ESG investment becoming mainstream) was never going to happen 10 or 15 years ago.”
3. China is an ESG bond behemoth
Make no mistake, China is an ESG debt giant. Assets in China’s ESG funds have doubled since 2021, lifted by Beijing’s growing emphasis on poverty alleviation, renewable power and energy security.
According to Zixiao (Alex) Cui, managing director CCX Green Finance International, in 2022, green bond issuance volume alone totalled about RMB 800 billion ($115.72 billion), marking a 44% increase year-on-year (YoY). In the first quarter of 2023, there were 113 green bond issuances worth almost RMB 20 billion.
“Actually, this number decreased compared to last year because right now in the mainland, the interest rate for lending loans from banks is very low so there’s really not much incentive to issue bonds,” he told the audience during a panel on the latest developments in Chinese ESG bonds and cross-border opportunities.
“But over the long term, I think we are on target to achieve a number no less than last year.”
At the heart of this momentum is China’s increasingly ESG positive regulation.
“Policy making is very critical because in the mainland, we have a top-down governance model mechanism which has proven effective in terms of scaling up the market – especially on the supply side.”
4. Greenwashing depends on your definition
When is greenwashing – the overstating of a company’s or product’s green credentials – technically measurable, and when is it a matter of opinion?
Gabriel Wilson-Otto, head of sustainable investing strategy at Fidelity International, told a panel addressing greenwashing and ESG hypocrisy issues, that these transparency and greenwashing concerns are often problems of definition.
“There is a bit of a disconnect between how these terms are used by different stakeholders in different scenarios,” he says.
On one side, is the argument around whether an organisation is doing what it says it is, which involves questions of transparency and taxonomy.
“In the other camp there’s the question of whether the organisation is doing what’s expected of it. And this is where it can get incredibly vague,” he explained.
Problems arise when interests and values begin to overlap.
“Should you, for instance, be investing in a tobacco company that’s aligned to a good decarbonisation objective? Should you pursue high ESG scores across the entire portfolio?” he queried.
“Depending on where you are in the world, you can get very different expectations from different stakeholders around what the answer to these sub-questions should be.”
5. Climate is overtaking compliance as a risk
While increased ESG regulation means that companies must take compliance more seriously, this is not the only driver. According to Penelope Shen, partner at Stephenson Harwood, there is a growing understanding that climate risks are real.
“The rural economic forum global risk survey shows that the top three risks are all related to financial failure directly attributable to climate risk and bio-diversity loss,” she highlighted during a panel called ‘ESG as a component of investment DNA and beyond?’
“In fact, if you look at the top 10 risks, eight of them are climate related.”
The prominence of climate as a risk factor has consistently ranked top of the survey over the past 10 years, she explained.
“Other more socially related factors such as cost of living and erosion of social cohesion and societal polarisation are also risks that have consistently ranked highly,” she noted.
What’s your view on the outlook for green, social and sustainable debt in 2023? We invite investors and issuers across APAC to have your say in the 6th annual Sustainable Finance Poll by FinanceAsia and ANZ.
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