COFCO hungry to beef up its presence in global food trade
China National Cereals, Oils and Foodstuffs Corp, the country's biggest food trader by revenue, will accelerate its pace of building warehouses and logistics facilities in the world's major grain-producing regions this year, said a senior executive on Wednesday.
The State-owned group plans to build new warehouses and processing facilities in countries including Myanmar, Kazakhstan, Ukraine and Indonesia to enhance its ability to acquire global food resources.
COFCO has already purchased and built ports, logistics companies and storehouses in the world's main grain-producing areas such as Australia, South America and the Black Sea region.
Wan Zaotian, COFCO's vice-president, said China has become the world's largest market for food trade. Supported by the Belt and Road Initiative, food trade between China and its partners is expected to grow rapidly. It is critical for the group to build efficient global supply and logistics networks.
"The food industry has gained a growing influence in the country's economy in the past six years. It plays an important role in boosting domestic consumption and accelerating supply-side structural reform," said Wan.
COFCO's revenue amounted to 216.12 billion yuan ($32 billion) in the first half of 2017, up 7 percent year-on-year. Its net profit in the same period also reached 5.51 billion yuan, surging 112 percent from the same period a year earlier.
"Countries and regions involved in the Belt and Road Initiative and China are strongly complementary in agriculture," said Ding Lixin, a researcher at the Chinese Academy of Agricultural Sciences in Beijing.
All of the companies that dominate global grain trading－ADM Co, Bunge Ltd and Cargill Inc from the United States, and Netherlands-based Louis Dreyfus SAS－serve as intermediaries between farmers and buyers. They are proficient in operating bulk ship services or even own a fleet to control the whole industrial chain.
In this regard, COFCO has signed a long-term cooperative agreement with China COSCO Shipping Corp Ltd to safeguard its grain shipping operations worldwide.
COFCO began to import beef from the United States at the end of last month and has so far purchased 2,200 metric tons from Kazakhstan through a freight train service launched in March.
Source: China Daily. Date: 2017-07-20
U.S. rice to be exported to China for first time
For the first time, U.S. rice farmers will now be able to export rice to China, according to a new agreement announced today by Secretary of Agriculture Sonny Perdue.
The agreement comes after more than a decade of negotiations between U.S. Department of Agriculture officials and the Chinese government.
Agriculture Secretary Sonny Perdue called this agreement "an exceptional opportunity" with "enormous potential for growth" in a press release.
China is the largest consumer, producer, and importer of rice, as the nation eats the equivalent of the entire U.S. rice crop in under two weeks, according to USA Rice, an industry association. Each year China fills its plate with almost 5 million tons of imported rice, according to the USDA.
When China joined the World Trade Organisation in 2001, U.S. rice imports were barred due to strict pest and pathogen protocols between the two countries, according to USA Rice spokesman Michael Klein.
However, a decade of negotiation has left American rice industry leaders confident. "We have high food quality standards in the U.S. and this is something the Chinese are very interested in," Klein said. USA Rice worked with USDA on this agreement and Klein noted that it will likely be months before rice is shipped due to final required inspections.
Rice is typically grown in six states: Arkansas, California, Louisiana, Mississippi, Missouri and Texas.
One farmer, Chris Crutchfield, 42, is a third-generation rice miller in California and called the closed Chinese market "frustrating," and that he is "very appreciative" of Secretary Perdue for pursuing this agreement.
This rice decision comes two weeks after the announcement that U.S. beef would again be allowed in China. To celebrate the beef agreement, Secretary Perdue joined U.S. Ambassador to China Terry Branstad in Beijing and sliced a thick cut of Nebraska prime rib to celebrate.
For American rice farmers, Crutchfield said that any celebration will likely be subdued as many in the U.S. rice market try to respect the crop and its cultural relationship to Asian history.
However, Crutchfield added, "I imagine that some farmers in the States will say a toast tonight at dinner, over rice."
Source: CBS. Date: 2017-07-21
Indian Poultry Farms Are Breeding Drug-Resistant Germs
Indian poultry farms aren’t just rearing chickens — they’re also breeding germs capable of thwarting all but the most potent antibiotics, researchers found.
Random tests on 18 poultry farms raising about 50,000 birds each in India’s northwestern state of Punjab found that two-thirds of fowl harbored bacteria that produce special enzymes, known as extended-spectrum beta-lactamase, or ESBL, that destroy most penicillin- and cephalosporin-based antibiotics. Of tested birds destined for meat consumption, 87 percent had the super germs, a study published Thursday in the journal Environmental Health Perspectives showed. That compared with 42 percent of egg-laying hens.
Farms supplying India’s biggest poultry-meat companies routinely use medicines classified by the World Health Organization as “critically important” as a way of staving off disease, an investigation by Bloomberg News showed last year. The latest research, the largest of its kind in India to date, highlights the consequence of this for the nation’s food supply.
“This study has serious implications, not only for India but globally,” said study author Ramanan Laxminarayan, director at the Center for Disease Dynamics, Economics & Policy in New Delhi, in a statement. “We must remove antibiotics from the human food chain, except to treat sick animals, or face the increasingly real prospect of a post-antibiotic world.”
Mutant Germs
Worldwide, animals receive about twice the volume of antibiotics that humans do. Much of it is administered in doses that speed growth in livestock, but aren’t strong enough to kill all the bacteria, leaving mutant germs to not only survive, but thrive and potentially spread.
That’s alarming veterinary and medical experts, who say the practice is stoking infections that no medicine will cure. Drug-resistant diseases have the potential to cause a level of economic damage similar to — and probably worse than — that caused by the 2008 financial crisis, the World Bank said in September. It could add as much as $1 trillion a year to health-care costs by 2050 across the globe.
Of the 16 farms in Punjab that answered questions on antibiotic use, all used the medicines to treat sick birds and to stave off disease, while two-thirds also used the drugs to spur chick growth. The researchers compared drug use with levels of resistance present in 1,556 E. coli specimens collected from more than 500 birds.
Superbug ‘Reservoirs’
“Our findings suggest that antimicrobial use for growth promotion promoted the development of reservoirs of highly resistant bacteria on the studied farms, with potentially serious implications for human health,” Laxminarayan and colleagues wrote in the study.
Farmhands who handle the birds often wear open-toe shoes, providing “a conduit of entry for resistant bacteria and resistance genes into the community and hospitals, where further person-to-person transmission is possible,” they said.
“Withdrawal of non-therapeutic use of agricultural antimicrobials in India would be prudent to protect public health,” the authors said.
‘Ecological Problem’
Antibiotic resistance is an “ecological problem that spans humans, food-animals and the environment,” Laxminarayan said in an email. Genes that enable bacteria to evade anti-infective agents are widespread, and are frequently transferred between environments and microbial species in India, spurred by indiscriminate use of the medications in both human and veterinary medicine.
“Easy access to high-end antibiotics, inappropriate prescription practices, and lack of awareness are major issues,” he said.
More than 56,000 newborns die annually in India because of bloodstream infections that aren’t cured by first-line antibiotics, Laxminarayan estimated in a paper in the Lancet in October. “It is worrying that resistance-related infections and deaths in India are approaching epidemic proportions.” he said.
Agricultural systems in emerging economies such as China and India have increasingly turned to antibiotic-dependent intensive farming methods in order to meet the surging demand for protein as dietary habits change and incomes rise.
Chicken is the most-consumed meat in India. It’s cheaper than other meats and is subject to fewer religious prohibitions or cultural taboos. Consumption has increased more than 30 percent since 2013, out-pacing all major markets, according to U.S. Department of Agriculture data.
A 2015 study predicted the use of antibiotics in livestock could more than quadruple by 2030 in some parts of India, primarily driven by “extreme” growth in chicken consumption. Broiler production is mainly concentrated in the states of Tamil Nadu, Andhra Pradesh, Maharashtra, Uttar Pradesh, and Telangana, the USDA said in a report in December.
Source: Bloomberg. Date: 2017-07-21
China's dairy products quality continues to improve Edit article
Some 99.8 percent of fresh milk and 99.5 percent of dairy products checked last year were up to standard, according to a dairy quality report released Wednesday.
The quality of domestic dairy products continued to improve in 2017, according to the report jointly released by the Dairy Association of China (DAC) and the Ministry of Agriculture (MOA).
The country's milk industry has recovered from the 2008 safety scandal, when infant formula produced by Sanlu Group, then a leading dairy company, was found to contain melamine, killing six babies and leaving thousands seriously ill.
Spot checks last year detected no illegal additives, such as melamine, the report said.
Some 98.7 percent of infant formulas checked were up to standards, exceeding many other domestically produced food products, according to the report.
Major quality and sanitary indicators were up to the standards of developed countries, MOA official Wang Jiaqi told a press conference for the report's release.
The quality of milk and dairy products has been improved as China has taken a string of measures over the past year, including improving regulations and industry standards and tightening supervision, said Liu Yaqing, deputy secretary of the DAC.
China produced 37.12 million metric tons of milk and 29.93 million tons of dairy products last year, ranking third after the United States and India, the report showed.
Source: China Daily. Date: 2017-07-20
Old foes sugar and corn syrup battle for lucrative Asian market
China's reform of its vast corn sector is spurring a rapid revival of cheaper high-fructose corn syrup (HFCS), putting it on a collision course with Asian sugar producers in a battle for the lucrative sweetener market.
Output of HFCS is set to jump 7 percent this year, according to commodities information service Zhuochuang, as cheap corn from a sell-down of the country's giant stockpiles encourages producers to boost output or restart idled capacity.
After stalling in recent years, HFCS production will hit 4.15 million tonnes, about half of the output in the United States, the world's top producer, where corn-based sweeteners account for nearly half of the sweetener market.
Syrup, used as a sugar substitute in soft drinks and other liquid products, is gaining in popularity in China where it sells for a third of the price of natural sugar made from cane or sugarbeets, and makes up about 20 percent of demand for sweetner.
China's producers have also found willing buyers abroad.
"HFCS is changing the structure of the sugar industry in China and Southeast Asia," said Liu Hande, vice chairman of the China Sugar Association. "Consumption of sugar has been declining in recent years."
Coca-Cola China boosted its use of the liquid last year, two industry sources said, and total demand is expected to jump to 4.06 million tonnes this year, up 18 percent from 2016 and almost double levels in 2012, according to Zhuochuang. Coca-Cola China said it could not confirm increased use of HFCS.
China's HFCS demand compares with expected sugar demand this year of nearly 16 million tonnes.
Exports from Chinese producers grouped in the northern province of Shandong and in southern Guangdong province soared nearly 70 percent in 2016 to 454,843 tonnes, worth about $180 million, and are on track to rise again this year.
About half went to the Philippines, followed by Indonesia, Vietnam and India.
Trade Restrictions
The push sparked anger in the Philippines, where domestic output of 2.5 million tonnes of natural sugar in 2017/18 will already outpace demand.
Imports of syrup to the Philippines surged to 373,137 tonnes in 2016, more than 10 times the levels in 2013, according to the Philippine Sugar Millers Association.
Following complaints from domestic sugar producers, Manila placed restrictions on Chinese corn syrup imports in March.
Coca-Cola and other beverage companies in the Philippines, also agreed to boost their use of domestic sugar, according to a statement issued by the Philippines Agriculture Department late March.
In the two months since Manila's crackdown, China's exports to the Philippines have plunged, with May shipments falling to 1,884 tonnes, down from 34,715 tonnes in March, according to Chinese customs data.
Regional pressure for substitution, however, is set to continue with Chinese HFCS prices falling by almost a third from about three years ago to below 2,500 yuan ($368) per tonne, according to industry insiders.
By contrast, sugar futures prices in China remain elevated at about 6,250 yuan per tonne due to high farm costs. In May, Beijing slapped hefty import tariffs on foreign sugar in a bid to protect the industry, a move that is expected to keep prices at a premium for years.
Tensions Rising
Traders, analysts and producers say the tensions over HFCS are starting to spread to other countries.
Syrup's rise is undermining industry forecasts that demand for natural sugar will grow in the region's emerging economies as consumption in mature markets like the United States slows amid concerns about the health impact.
"If you have a cheap source of HFCS supply ... this always poses a significant threat to use of sugar," said Stefan Uhlenbrock, senior analyst at F.O. Licht. "It not only happens in the Philippines but also in other countries."
Indonesia's fructose syrup imports hit 107,321 tonnes in 2016, up 55 percent from a year earlier, but are still dwarfed by annual white sugar consumption of up to 6 million tonnes.
"If the (import) amount is big, this can be a threat for refined sugar, because HFCS is basically sweetener, just like refined sugar," said Benny Wachyudi, Chairman at the Sugar Refineries Association.
Source: Reuters. Date: 2017-07-21
Troubles for top beef exporters feed higher global meat prices
Fatter prices for all types of meat may be on the cards as religious and health concerns threaten to curtail supply from the world's top beef exporting countries and leading importer China seeks to satisfy its appetite with other sources.
India exported the most beef in 2016, sending 1.76 million tons abroad, according to the U.S. Department of Agriculture, a figure that equates to 19% globally. The bulk of India's total comes from buffalo meat, which sells for around half the price of ordinary beef. And though roughly half of these Indian exports go to Vietnam, much of that meat is forwarded to China, the top beef consumer worldwide.
But that all stands to change after Indian Prime Minister Narendra Modi's government ordered a ban on the sale of cattle for slaughter in late May. The ruling Bharatiya Janata Party triumphed in key state elections in March, giving Modi the political muscle to enact the ban. The country's Supreme Court suspended the law on Tuesday. But the party is backed by a Hindu nationalist group that is particularly opposed to the slaughter of cows -- a sacred animal in Hindu tradition -- casting uncertainty over whether India will remain a stable beef supplier.
Beef buyers also are preparing for a lean period from Brazil, based not on politics or religion but rather over questions of safety. The country exported 1.69 million tons of beef last year, or 18% of the world total. But the U.S. on June 22 halted imports of fresh Brazilian beef, citing food safety concerns. Brazilian media report abscesses were found on beef carcasses. This incident comes after Brazilian meat processors were discovered in March to be selling chicken and other products that fell short of sanitary standards.
These quality concerns could give China further reason to take its business elsewhere. The Asian nation imported 812,000 tons of beef in 2016, according to the USDA, beating No. 2 importer Japan by nearly 100,000 tons. Though Japan obtains no beef from India or Brazil, the country still may face rising prices for various meats as China substitutes products from those leading markets with others, according to a major meat wholesaler.
Meat from Australian milk and breeding cattle, sold here in ground form, fetched around 705 yen ($6.18) per kilogram on the wholesale market in early July, up 19% from a year prior. Fewer cattle have been raised due to a drought in the country, eating into supply. Prices on Thai chicken have fattened 5% on the year as buyers shift away from the meat's Brazilian counterpart.
Japan is entering a season of heavy demand for meat. But passing on any rising wholesale prices to the public could blunt sales, said a representative for Tokyo-centric supermarket chain Inageya, if the country's sluggish personal consumption figures are a reliable indicator.
Source: Nikkei Asian Review. Date: 2017-07-19
Canadian pork industry acting quickly on ractopamine finding in China
Pork groups and the Canadian Meat Council are working together to avoid any disruption to exports to China in the wake of a residue complaint from that country.
China says it has found traces of the growth promoter ractopamine in a shipment of pigs’ feet.
“Canadian Pork International, Canadian Pork Council and the Canadian Meat Council are working with the establishment involved as well as with Canadian government officials to clarify this incident and to take corrective actions,” said Pork Council spokesman Gary Stordy. “We are taking this detection very seriously and want to assure Chinese customers that our industry is dedicated to providing consumers a healthy, safe and nutritious product.”
The industry is confident in the integrity of the Canadian Ractopamine-Free Pork Certification Program, which sets the standards for meeting China’s requirements that meat be free of ractopamine, he said.
China was the third-biggest export customer for Canadian pork in 2016, buying 587,100 tonnes of product, behind the United States and Japan.
After being advised about the incident by the Canadian Embassy in Beijing, the Canadian Food Inspection Agency issued an advisory to the industry that “China is looking at this violation as a systemic failure in implementation of the Canadian Ractopamine-Free Pork Certification Program which could affect future pork exports to China. Furthermore, the Chinese authorities are testing Canadian pork for ractopamine at a wider level.”
The agency has suspended exports of pork to China from the establishment, which has not been identified, said Ron Davidson, vice-president of the Canadian Meat Council. “Product en route to the Chinese market from this specific establishment is also being recalled and the plant involved will not ship until further notice.
“At present, the establishment is liaising with its suppliers and the CFIA in the conduct of a comprehensive review of all the factors associated with the shipment,” he said. “As soon as the preliminary investigation is complete, a report containing the analysis and findings will be submitted to the CFIA for onward transmission to China.”
“We look forward to receiving more information and reviewing the compliance with the program at all levels of the supply chain,” Stordy said. “The Canadian pork industry values its relationship with China and looks forward to continuing a strong trading relationship.”
Ractopamine as a feed additive is allowed for beef and pork in Canada, the United States and Mexico but banned in about 160 countries including the European Union, Russia, China and Taiwan even though the Codex Alimentarius says it’s safe to use with appropriate withdrawal periods. Canada also allows it to be used in finishing heavy turkeys.
Source: GlacierFarmMedia. Date: 2017-07-19
China's High-rise Hog Hotel
Hog barns—stacked eight stories high. The photos from Iowa Secretary of Agriculture Bill Northey traveled around the Twitter-verse lightning fast, raising eyebrows and slackening jaws of U.S. producers and industry leaders. We all want to know: “How do you manage that manure?”
Northey, on a trade mission with the Iowa Soybean Association in Guangxi, in south-central China, says the buildings were part of an expansion project with Chinese feed mill and pork producer Guangxi Yangxiang Co.
With land coming at a premium in China, pork producers are looking for ways to maintain animal production numbers, on fewer acres. The company already has a boar unit—1,500 boars, with plans to go to 5,000.
Northey said in another part of this mountain, they were building four high rises—each eight stories of sows with the ninth story for ventilation equipment.
“This was to be 30,000 sows on this side of the mountain, and another 10,000 sows just kind of across the mountain. All these animals are served by one feed mill.”
From the sow facilities, the 10-day to 3-week old pigs would be transported to nursery and finishing facilities farther down the mountain, or sold on contract to other producers.
“As far as they knew, and as far as we knew, this is the first more-than-two-story hog facility in production,” Northey says. “They said there are some two-story facilities out there, but this is the first eight-story building with pigs in it. There looked to be three [buildings] up, and another one in process. So potentially four buildings, with 7,500 sows per building. Just amazing.”
So How Would it Work?
Northey says they only saw the buildings from a distance, but here are a few ideas on how the buildings might look on the inside:
- Scrapers under each floor.
- A dedicated water and waste water system. He says in this case, they plan to separate waste water, dry the manure and haul it down the mountain. There seems to be some incentive or requirements in siting new facilities that would encourage integrated waste management for large operations.
- Ventilation for each floor. Basically, Northey says to think of it like single story buildings stacked on top of each other—there would need to be air intake and outtake measures for each floor. Some extra consideration would need to be taken on the structural side, with each floor being able to handle the weight of the animals and the building overall.
- Elevators to move animals and people to and from each floor.
- Multilevel ways of moving feed, both from the feed mill to the facility and within the facility itself. Likely there would either be an auger or pressurized air-driven delivery system.
Biosecurity was a major talking point for Chinese pork producers.
“They talked about it all the time,” Northey says. The placement of sows and boars near the top of the mountain, and have pigs move down the mountain to finishing facilities were one way to improve biosecurity. “They believe the isolation away from other pigs is a huge part of what they were building. This was very biosecurity driven—they wanted to build this facility miles and miles away from other producers, and their employees would be limited in their exposure to pigs on other farms.
The group Northey was traveling with was able to get a closer look at the boar facility, but went through stringent protocols. “They suited us up, washed our van and then we could get within a ½ mile of that facility to look at it,” he says.
“You have both the concentration of this many sows in one location that you would worry about, but if you could limit the exposure to other pigs, I think they believe they will have less disease than other facilities would have,” he says.
Source: AGWeb. Date: 2017-07-19
China approves two more GMO crops for import, DuPont disappointed
China has approved two more genetically modified (GMO) crops for import, the Ministry of Agriculture said, the second such move in the past month to expand access to biotech seeds as part of Beijing's 100-day trade talks with Washington.
The two new crops, approved from July 16 for a period of three years, are Syngenta's 5307 insect-resistant corn sold under the Agrisure Duracade brand and Monsanto's 87427 glyphosate-resistant corn, sold under the Roundup Ready brand, the ministry said on its website on Monday.
The move brings total approvals to four after the government last month gave the go-ahead to Dow Chemical Co's Enlist corn and Monsanto's Vistive Gold soybeans.
But it leaves four other products owned by Monsanto, DuPont and Dow still on a waiting list pending approval from Beijing.
DuPont was "disappointed" its Pioneer insect-resistant corn was not included, a spokeswoman said in an email. The other three are Dow's Enlist soybeans and two alfalfa products developed by Monsanto.
Dow's Asia Pacific media relations representative Eileen Zeng could not be immediately reached nor could Monsanto's China corporate affairs manager Lian Meng for comment.
Hopes that all six would get the go ahead in the second round mounted after the National Biosafety Committee (NBC), a group of experts who advise the government on GMO safety, met late last month to review the six remaining products, company executives and experts said.
The first batch of approvals also followed an NBC meeting. The government has not confirmed the meeting took place or commented any further on the issue.
The approvals come after China promised to speed up a review of pending import applications as part of the 100-day trade talks with the United States. China is the top export market for U.S. agricultural products.
While the country does not permit planting of GMO food crops, it does allow GMO imports such as soybeans and corn for use in its animal feed industry.
Getting new varieties approved for import takes years, forcing leading agrichemical players to restrict sales during China's review process.
Earlier this year, DuPont Pioneer began a limited commercial introduction of its next-generation Qrome corn products under stewardship in the Western United States, allowing it to make the new technology available to some growers ahead of Chinese approval.
DuPont continues to cooperate with Chinese regulators, the spokeswoman said, but added that "global markets should conduct predictable, transparent regulatory reviews based on sound science and be free from political influence".
The U.S. industry has repeatedly complained about the lack of transparency in China's biotech review process.
Beijing has in the past held back approvals of imported GMO products amid concerns about anti-GMO sentiment in the country.
Source: Reuters. Date: 2017-07-18
ADB: Climate Change Threatens Asia’s Development Gains
Asia’s hard-won development gains are at risk of being reversed by the effects of climate change, according to the Asian Development Bank (ADB). However, the news is not all bad for the region, with new energy investments expected to cement its leadership in the “clean industrial revolution.”
The warning on climate change follows U.S. President Donald Trump’s decision to withdraw the world’s second-biggest emitter from the Paris Agreement, even while the rest of the Group of 20, including the world’s largest emitter, China, have vowed to press ahead with emissions reductions.
Released Friday at the bank’s headquarters in Manila, the report produced by the ADB and the Potsdam Institute for Climate Impact Research (PIK) makes for grim reading, should the predictions eventuate. Under a “business as usual” scenario, a 6 degree Celsius temperature rise is projected over the Asian landmass by the end of the century, with an increase as high as 8 degrees C forecasted in Afghanistan, Pakistan, Tajikistan, and northwest China.
“These increases in temperature would lead to drastic changes in the region’s weather system, agriculture and fisheries sectors, land and marine biodiversity, domestic and regional security, trade, urban development, migration, and health. Such a scenario may even pose an existential threat to some countries in the region and crush any hope of achieving sustainable and inclusive development,” the report said.
Among the predicted effects are more intense tropical cyclones and typhoons, with coastal and low-lying areas at increased risk of flooding. Global flood losses are expected to reach $52 billion a year by 2050 compared to $6 billion in 2005.
Thirteen of the top 20 cities seen suffering the largest growth in flood losses are located in the Asia-Pacific, comprising Guangzhou, Shenzhen, Tianjin, Zhanjiang, and Xiamen in China; Chennai-Madras, Kolkata, Mumbai, and Surat in India; Jakarta, Indonesia; Nagoya, Japan; Bangkok, Thailand; and Ho Chi Minh City, Vietnam.
Yet while annual precipitation is expected to increase by up to 50 percent over most land areas in Asia, countries like Afghanistan and Pakistan could see a decline in rainfall by 20 to 50 percent, the ADB said.
Food production will suffer as a result, with production costs also rising. In some Southeast Asian nations, rice yields could decline by up to 50 percent by 2100 “if no adaptation efforts are made,” while almost all crops in Uzbekistan could see a 20 to 50 percent decline even under a 2 degree Celsius temperature rise.
Food shortages could increase the number of malnourished children in South Asia by 7 million, as food import costs surge to $15 billion a year by 2050 compared to $2 billion.
Major disruptions to current farming communities could prompt mass migration to the cities, fueling overcrowding and overwhelming social services.
Energy security could also be threatened, due to the reduced capacities of thermal power plants from a scarcity of cooling water and the potentially intermittent performance of hydropower. This could fuel conflicts as countries compete for limited energy supply, the report warned.
Meanwhile, marine ecosystems such as coral reefs will be in serious danger. In the Western Pacific, all coral reef systems will suffer mass coral bleaching if global warming increases by 4 degree Celsius, yet even a 1.5 degree C temperature rise would cause serious bleaching to 89 percent of coral reefs, damaging reef-related fisheries and tourism.
These losses could amount to billions of dollars, judging by a recent estimate that Australia’s Great Barrier Reef is worth A$56 billion ($44 billion) in tourism and other economic benefits, or the equivalent of 12 Sydney Opera Houses.
Climate change would also cause damaging health effects, with heat-related deaths among the elderly expected to increase by 52,000 by 2050, according to World Health Organization data. Deaths related to diseases such as malaria and dengue could also rise, adding to the death toll from outdoor air pollution, which is already causing 3.3 million deaths each year globally, led by China, India, Pakistan, and Bangladesh.
Asia is already experiencing the effects of climate change, accounting for nearly 30 percent of total global economic losses caused by extreme weather between 2000 and 2008, according to the UN Intergovernmental Panel on Climate Change.
Ratings agency Standard & Poor's has also suggested that Cambodia, Vietnam, and Bangladesh are the world’s most vulnerable countries to climate change, based on factors including agricultural output and adaptive capacity.
Economic Opportunity
However, Asia’s response to climate change provides it with an economic opportunity too, as noted by PIK director Professor Hans Joachim Schellnhuber.
“On the one hand, Asian greenhouse-gas emissions have to be reduced in a way that the global community can limit planetary warming to well below 2 degrees Celsius, as agreed in Paris 2015. Yet even adapting to 1.5 degrees Celsius temperature rise is a major task,” he said.
“So, on the other hand, Asian countries have to find strategies for ensuring prosperity and security under unavoidable climate change within a healthy global development. But note that leading the clean industrial revolution will provide Asia with unprecedented economic opportunities. And exploring the best strategies to absorb the shocks of environmental change will make Asia a crucial actor in 21st-century multilateralism.”
Asia has already become a world leader in clean energy investment, led by China, which plans to spend 2.5 trillion yuan ($369 billion) on renewable power generation by 2020. Both China and India are seen attracting $4 trillion worth of clean energy investment by 2040, helping to decouple economic growth from emissions, according to Bloomberg New Energy Finance.
The ADB has backed such efforts with a record $3.7 billion in climate financing in 2016, which it has committed to reaching $6 billion by 2020. Rival Beijing-led lender, the Asian Infrastructure Investment Bank, has also pledged to support investments in renewable energy and energy efficiency as part of the Paris Agreement, noting that more than 1 billion people in Asia still lack access to secure and clean electricity.
The ADB considers the coming decade as crucial in implementing mitigation measures, since the “business as usual” scenario projected under the Paris accord would render any adaptation efforts ineffective.
Despite a 10-fold rise in per capita incomes over the past 25 years, Asia still remains home to two-thirds of the world’s poor, risking even deeper poverty and disaster should mitigation and adaptation efforts fail.
Fortunately for the world’s most economically dynamic region, Asia still has “both the capacity and weight of influence to move toward sustainable development pathways, curb global emissions, and promote adaptation,” the report concluded.
The message could not be any clearer for Asia’s policymakers, should they wish to sustain the region’s stunning economic success.
Source: The Diplomat. Date: 2017-07-18