Southeast Asia Partnership for Adaptation through Water (SEAPAW) Ecosperity Partner Event - Mr Baey Yam Keng

1. Good afternoon to all of you. It is my pleasure to join you today at this SEAPAW Ecosperity event.

Impact of climate change on Southeast Asia

2. It is fitting that this event is called “Water at the Core: Accelerating Climate Adaptation in Southeast Asia”, as climate change impacts are becoming more apparent worldwide in the form of more extreme weather events, such as droughts and storms. Although the world has made some progress in climate mitigation since the Paris Agreement, efforts remain insufficient to limit global warming to 1.5 degree Celsius. If global temperature rise overshoots this and reaches 2 degree Celsius, the Intergovernmental Panel on Climate Change (IPCC) projects that 50% more of the world’s population would live under water stress.

3. Water stress arises from the extremes of too little and too much water. Too little water, and many of Southeast Asia’s economic activities, such as agriculture and tourism which depend on water, will be severely affected. Too much water, and this could lead to sea level rise and flooding, threatening our people given our geography comprising long coastlines, low-lying islands, and dense urban centres. 

Singapore Water Story

4. These are among the starkest environmental challenges facing Singapore. As a small island city-state with limited natural catchment, Singapore is amongst the most water stressed in the world. Our Water Story demonstrated that acknowledging our vulnerabilities can spur us to overcome them by leveraging technologies to diversify our water sources. Singapore began studying the feasibility of reclaimed water since the 1970s, and today NEWater has become one of our weather-resilient sources in Singapore’s “Four National Taps” strategy. 

5. At the same time, being situated in the tropics also results in the problem of too much water within a short span of time. In the 1960s and 1970s, Singapore faced frequent and widespread flooding during the monsoon season. While Singapore has invested in expanding our drainage infrastructure, it is not feasible to expand our drains to cater for every extreme rainfall event. We are thus enhancing community resilience by supporting our community to better prepare for and respond to flood incidents, such as by issuing early warnings of potential flood. The next chapter of flood resilience will be coastal protection to deal with rising sea levels. Many of you would have heard about initiatives such as our Long Island, which will not only protect our low-lying east coast from sea level rise, but also create new land for future opportunities. 

Investing in Climate Resilience

6. Our experience has shown us that it is important to understand our risks clearly, start early and invest conscientiously to strengthen our climate resilience.  However, there is serious underinvestment worldwide. According to a report by the Climate Policy Initiative, global investments in climate adaptation and resilience initiatives made up only 5% of total annual climate finance and 20-30% of projected annual climate adaptation financing needs. I would like to touch on two areas where there are opportunities to do better. 
   

7. First, the private sector. We need to increase the private sector’s awareness of physical climate risks and the cost-of-inaction. Understanding climate risks is key to business strategy and future-proofing your business. When it comes to addressing climate risks, prevention is better than cure. A small investment in climate resilience today can help to address broader risks, and mitigate potentially larger future losses. There are many ways to help companies tackle climate risks. First, we need better climate projections, such as the findings from Singapore’s 3rd National Climate Change Study (V3), which we completed last year. V3 provides the highest resolution of climate projections over Southeast Asia for parameters such as rainfall and temperature. Through our recently launched V3 Data Sharing Portal, companies can tap on V3 climate projections to understand the climate risks in their supply chains under future conditions. Next, climate disclosure frameworks can encourage companies to pay closer attention to their climate risks across geographies and supply chains. Beginning Financial Year (FY) 2025, there will be a move towards mandatory climate-related disclosures for listed companies and large non-listed companies in Singapore. These disclosures will be aligned with the framework developed by the International Sustainability Standards Board (ISSB). This will raise companies’ awareness and spur them to take a more informed view of addressing climate risks. I encourage companies to leverage climate projections such as V3 for your climate risk assessment, and to undertake climate disclosure seriously.
   

8. With climate disclosure, the risks become more apparent, and companies would seek to reduce their climate exposure. One way would be to relocate their operations to another place with less climate risk. A more beneficial approach would be for companies to invest in where they operate, increasing the community’s climate resilience while also strengthening their supply chain resilience. For example, Systems on Silicon Manufacturing Company (SSMC) is Singaporean wafer fabrication company who has been recycling water at an average of 67%, above the industry average of 45%. This improves onsite water efficiency and decreases water consumption, leading to a more water-resilient supply chain, especially during the dry months of the year. I would like to challenge companies to explore how you can do likewise for your operations throughout Southeast Asia.

9. The second area we can focus on is to enhance adaptation finance. We can do so by making climate adaptation projects more bankable through blended finance, and also by building capability in climate finance. 

10. Collectively, we should explore how to support blended finance in climate adaptation, so that we can create more bankable projects that crowd in private capital to plug the gap in adaptation financing. This is important as only about 2% of adaptation finance comes from private and philanthropic sectors. Blended finance can make adaptation projects more bankable through a combination of concessional capital, technical assistance and de-risking mechanisms. Concessional capital could comprise grants or guarantees, with technical assistance covering areas such as project development to strengthen investor confidence and project bankability. We need to reduce the project risks sufficiently to attract private commercial capital. 

11. Putting these altogether, we should also recognise the critical role that local partners and NGOs like SEAPAW play. SEAPAW builds on the Singapore International Foundation (SIF)’s track record over the past 34 years, whose projects have created community benefits in more than 28 countries. Through SEAPAW’s network of partners, it can localise global solutions and partner them with the right financing options which are suited to the needs of communities. One example is SEAPAW’s project in Sarawak, Malaysia, which aims to bring clean water to rural communities. The project uses advancements in membrane technology in the water purification process to enhance water resilience and address the issue of clean water supply. At the same time, it is powered sustainably by a renewable energy source. Once the pilot is successful and partnered with the right financing, it can be scaled up to benefit many more communities within Southeast Asia. This multi-stakeholder approach taken by SEAPAW allows them to harness the strengths from across the public, private and philanthropic sectors, and bring them to bear in addressing the climate challenges we face in our region.

Closing

12. In closing, similar to how Singapore made early investments in NEWater, which is now a key pillar for our water resilience, we need to invest now for the future for our climate resilience. We need to act decisively today for the long-term, by increasing the knowledge on risks and encouraging climate adaptation finance. I encourage organisations and individuals across sectors to explore how you can contribute to this collective effort. Whether through funding, innovation, or community support, do join SEAPAW in accelerating Southeast Asia’s climate resilience.