What is “Natural Capital”: Perspectives from Mekong policy makers at EMM4

What is “Natural Capital”: Perspectives from Mekong policy makers at EMM4

Hosted by the Asian Development Bank (ADB), the fourth Environment Ministers’ Meeting (EMM) was on the theme of “Increasing Investments in Natural Capital in the Greater Mekong Subregion” and held in Nay Pyi Taw, Myanmar from 27-29 January 2015.

What is “natural capital”? Is it just another conference jargon that will soon be forgotten in the midst of the massive ADB-funded infrastructure projects? Or could it retain something meaningful to address the region’s environmental challenges?

These questions gained even more importance as the EMM4 followed soon after the 5th GMS Summit held in December 2014 where GMS country leaders committed to a massive investment in regional infrastructure – a total of US$30 billion under the Regional Investment Framework (RIF) Implementation Plan (2014–2018).

Below are perspectives from interviews and notes from the key policymakers who attended EMM4. They share their views about “natural capital”, whether they view the concept as meaningful for planning and policy, and how they intend to address key environmental challenges. 

1. Myanmar

Dr. Daw Thet Thet Zin, Deputy Minister for Ministry of Environmental Conservation and Forestry.

“Natural capital is the stock of capital drive from natural resources such as biodiversity and ecosystems in addition to geological resources such as fossil fuels and mineral deposits. It also underpins a range of ecosystem services, which are central to the livelihood of people; particularly to economically marginalized or resource dependent people as their subsistence livelihoods highly rely on ecosystem services and functions that underpin our economy and indirect benefits to business.”

“It is simply not enough to sustain natural capital using traditional management approach or business as usual. Smart investment on creative or innovative green economy are needed.

“This forum is a platform to brings together representatives from government agencies, private sector, NGOs and INGOs to discuss the effective management on natural capital through increasing investment in green and creative economy.”

2. Lao PDR 

Mr. Xaypladeth Choulamany, Dir-Gen of Planning and Cooperation, Ministry of Agriculture and Forestry, Vientiane, Lao PDR.. 

“‘Natural capital’ seems to be the new buzzword. But this buzzword may help to make policymakers better understand “environmental externalities.

“We still need more understanding of the term [natural capital], and more awareness about what it means for policy. We are already taking environmental considerations into account in policy and planning in Laos. But it seems this concept is more for the private sector’s benefit, to make them conscious of corporate social responsibility (CSR) when trying to make profits.

“Laos is facing challenges in the agriculture value chain. The processing facilities are minimal and need more investments. Without good processing facilities, the rice is sold in border trading rather than trying to add value and sell in export markets.

“We already have a competitive advantage since our rice crop consists of many local varieities. We’re second after India in terms of producing indigenous rice varieties. We have about 13,000 local varieties of which farmers plant about 30-40. Also, we don’t use much chemicals. 

3. Cambodia

H.E. Yin Kim Sean Secretary of State, Ministry of Environment.

“Cambodia is facing various challenges caused by natural disasters including floods, drought and environmental degradation. In Cambodia, for example, the most recent flood in 2013 caused damages of more than $350 million or about 10% of the annual national budget. The full damage of climate change on our annual GDP is estimated to reach at least 3.5% in 2050 under the scenario of a 2C temperature rise.

“Natural capital underpins the socioeconomic development; ensures energy, food and water; as well as helps maintaining the resilience to natural and human-induced disasters in the GMS countries, we need to urgently and increasingly invest in the protection and restoration of our valuable natural assets.

“Cambodia is initiating the “Rectangular Strategy-Phase III” as a blueprint for mainstreaming environmental issues into key sectoral policies.

“Specifically, we have earmarked special budget for state land registration exercise that includes zoning, demarcation and land titling in our protected areas. Additionally, we are also in the process of upgrading and strengthening our rangers’ capacity and skills for effective patrolling and law enforcement. We have also recently approved the establishment of environmental funds for improving the management of liquid and solid wastes in our cities”. 

PR China

Mr. Wan Bentai, Chief Engineer Ministry of Environmental Protection.

“In recent years, the Chinese government has put environmental protection at a more prominent strategic level, made great efforts to push forward the building of ecological civilization, explored proactively a new path for environmental protection.

“As of 1st January 2015, the newly revised Environmental Protection Law of PRC has come into effect. The revised law provides a more solid legal basis and institutional guarantee to environmental protection and improvement, pollution and hazards prevention and control, public health safeguards and ecological civilization construction.

“We need efforts to speed up the opening-up of the borders, to advance the fostering of the Silk Road Economic Belt and the 21st Century Maritime Silk Road (the one belt one road concept) so as to form a new all-round opening-up structure. Cooperation in the environment field. This is one of the core areas for the GMS cooperation.

“We need to explore solutions to South-South environmental cooperation … by setting up scientific support via inter-governmental cooperation. We need to build an environment think-tank exchange platform and expert network among the six countries, with a view to providing intellectual support to the advancement of the South-South environmental cooperation.

Thailand

Dr Wijarn Simachaya, Permanent Secretary, Ministry of Environment and Natural Resources (MONRE). 

“Natural capital is a good concept but the important things is how to increase public awareness of natural resources conservation. When we say ‘capital”, people may think of money and investment. So we need to know how to interpret the technical term in public in general and for implementation in the Mekong Region.

“The concept of natural capital means we have to assess what we have in stock. We ned to balance development with resource conservation."

Vietnam

H. E. Bui Cach Tuyen, Vice Minister, Ministry of Natural Resources and Environment.

“The Viet Nam’s Green Growth Strategy (VGGS), approved in 2012, focuses on reducing the energy intensity of production, controlling greenhouse gas emissions, reducing waste and encouraging the sustainable use of the country’s natural capital.

“The Party Resolution to Respond to Climate Change, Environmental Protection and Natural Resources Management which was approved by the 11th Central Committee has further strengthened the national policy framework to achieve green growth. The Resolution recognizes that natural resources are nationally important and finite capital assets, which require thorough assessment, valuation and inclusion in national economic accounting.”

Related links:

1. EMM4 Joint Ministerial Statement.

2. EMM4 – All speeches and statements.

3. Storify collection of live tweets by SEI from #EMM4.