South-east Asia green economy may see US$1t in annual opportunities: report

DEVELOPING South-east Asia's green economy could provide up to US$1 trillion in annual economic opportunities by 2030, Bain & Company said on Thursday.

However, there is a gap between where South-east Asia is compared to other regions in their green initiatives, the global consultancy said.

"This gap presents a threat to South-east Asia's global competitiveness but also creates immense opportunities for the region," Bain said.

Economies globally have committed to spend more than US$3 trillion in 2020 to "build back better" and stimulate green industries, the report noted.

Economic opportunities from developing South-east Asia's green economy include value from new products and sectors emerging and growing from sustainable production and consumption, as well as savings from resource efficiencies from using less to produce more, Bain said.

Shifting to sustainable energy consumption and resource extraction will present S$270 billion in annual economic opportunities by 2030. These include shifting to renewables and alternative fuels, rethinking operations, and adopting circular economy practices.

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Meanwhile, embarking on transformational pathways in the food and agriculture sector will allow South-east Asian companies to capture US$205 billion in annual opportunities by 2030.

Such opportunities include encouraging dietary shifts through alternative proteins and function foods, leading the future of urban agriculture and sustainable aquaculture, as well as building end-to-end traceability.

Setting up efficient industries and logistics may offer US$200 billion in opportunities by 2030. These include digitising supply chains, standardising regulations and reducing carbon footprint. Other pathways include building efficient manufacturing systems by adopting Industry 4.0 practices and developing sustainable packaging.

Transforming urban centres into green and connected cities offers US$185 billion in opportunities by 2030. These opportunities include improving energy efficiency and connectivity, rethinking affordable housing and defining a new model for mobility services.

Other pathways for transforming urban centres include integrating waste management solutions and redesigning cities using smart urban planning.

"With an estimated 90 million people moving to South-east Asian cities by 2030, the potential is immense," the report noted.

Financial institutions, investors and other service providers can also accelerate the shift to sustainable investing by deploying capital to projects or startups that support the growth of the green economy; develop green financing instruments, and establish a carbon market and services ecosystem.

Bain & Company also announced on Thursday that it has launched a Global Sustainability Innovation Center (GSIC) in Singapore with the support of the Singapore Economic Development Board.

The GSIC will support Bain's deep expertise in sustainability in the region, helping companies to reach their ESG goal, it said. Through the centre, Bain aims to pioneer innovative solutions to accelerate corporates' sustainability journeys.