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Malaysia’s climate action commitments are vital, but difficult to achieve. A three-pronged approach opens possibilities to be a low-carbon economy, says ISEAS-Yusof Ishak Institute’s Dr Vinod Thomas.
File photo of office workers in Singapore's central business district. (File photo: iStock)
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To be sure, green growth is a global agenda and the burden rightly falls on the major economies and their disproportionately high carbon emissions.
Malaysia’s responsibility in mitigating emissions becomes clearer at the regional level; the country constitutes 5 per cent of Southeast Asia’s population but contributes 15 per cent of Southeast Asia’s carbon effluents, marking a relatively high figure per person.
ESSENTIAL FOR GROWTH
Malaysia must accelerate economic transformation in line with its climate action goal of halving carbon emissions by 2030 (compared to 2005 levels). Climate action must not be viewed as inimical to growth but rather as essential for growth to be sustained.
Southeast Asia, by one study, could lose 30 per cent of gross domestic product by 2100 from labour productivity loss, workers’ health deterioration, spikes in natural disasters, and agricultural losses under a “high emission” scenario. Climate policies and investments, or decarbonisation, bring the social benefit of averting such economic calamity.
Decarbonising the economy also entails a social cost, even if the cost is estimated to be far smaller than the social benefit. Nevertheless, public policy must give due attention to adverse social impacts, such as the potential displacement of over 40,000 workers currently in Malaysia’s petroleum, chemical, rubber and plastic industries, when these industries are scaled down or even phased out.
Economic policies must also provide training and safety nets for workers caught in the transition, and emphasise job opportunities in new, scaled-up green industries such as renewable energy.
About 92 per cent of energy production in Malaysia is based on the fossil fuels of coal, oil, and gas. Energy production, comprising electricity and heat, is associated with nearly 50 per cent of carbon emissions.
Significantly, transport is next, with 29 per cent (compared to a global average of 25 per cent), followed by industry, which encompasses manufacturing and construction.
The phasing out of fossil fuels in electricity generation is the centrepiece of Malaysia’s 2050 net zero commitment. Recent five-year plans have embraced environmental sustainability, including the National Energy Transition Roadmap (2023-2050), National Energy Policy (2022-2040), Green Technology Master Plan (2017-2030), the Feed-in-Tariff mechanism introduced in 2015, and the Renewable Energy Act of 2011.
