Saturday 21 September 2013

Tracking the Pathways to Sustainability: Green Economy & Bio-Economy

Today, our continuing progress is restricted not by the number of fishing boats but by the decreasing numbers of fish; not by the power of pumps but by the depletion of aquifers; not by the numbers of chainsaws but by the disappearance of primary forests.
Paul Hawken, Natural Capitalism.

There is everywhere the desire to conquer nature, but in the process the value of the conqueror himself, who is man, is destroyed and his very existence threatened.
Seyyed Hossein Nasr, Man and Nature, 1975.

Growing up in rural Kelantan in the 60’s was a real blessing to me. At the age of five our family moved to a remote village only accessible by boat along the mighty Kelantan River. My father was posted to the village to become the headmaster of a makeshift school built with attap roofs and soiled floors. Since there were no teachers’ quarters and there were no houses for rent in the village, our family resorted to staying on a “rumah rakit” or a “floating house”, a shabby hut built on a bamboo raft, tied to a big tree on the river bank. The raft was our home for a few months until the villagers were able to build a permanent one on the ground. Despite living in primitive conditions, the little house on the raft was a heavenly experience to me, forever cherished and well remembered in my life. Two years later the family moved back to our kampong, which is also located along the river bank of Kelantan River, about 90 km downstream. To me the image and the memory of the river was one of might and magnanimity, of life and sustenance, of water so clear, cool and fresh. As children we were taught to collect tiny clams called etak from the river beds, a delicacy snack once they are sun-dried and slightly salted. We followed the adults at night to scoop the giant prawns udang galah from their nesting sites along the river banks. During play, we were cautioned by the adults not to be too daring to swim into the deep pools or lubuks of the river, lest fishes as large as we were would bite and eat us alive – a scare tactic to prevent us from drowning, but big fishes were real, minus the biting mouthparts. Rivers were once the centre of our life, our paradise, a place where life springs forth and thence blossoms. But, these were only memories of my river paradise. 

Today, I dare not bring my children to the Kelantan River for them to experience a glimpse of my youth. For the pristine and clean Kelantan River is gone, its water turbid brown with suspended soil particles, its banks soft and muddy, the river beds thick with silt, and its etak and udang galah and ikan patin are scarce. Seen from an aeroplane, the Kelantan River is a yellow band of line cutting across the green landscape. We used to refer this colour to the colour of our favourite drink “teh tarik”, tea mixed with sweetened condensed milk. What is left with Kelantan River is just a sight of shame and a burden of guilt. Decades of intensive clearing of jungles and forests in its watershed area upstream for the extraction of timber and for the cultivation of oil palm have caused an environmental catastrophe beyond anybody’s expectation. In a landmark study by Ambak and Zakaria in 2009, the investigators reported that nine major species of fish in the river was considered as critically endangered. Earlier studies in the early and mid 90s showed that the Kelantan river system was still rich in freshwater fishes, supporting a total of 55 species. Within one generation, the Kelantan River ecosystem is practically dead, devoid of its lustre and vigour. The role of Kelantan River in sustaining a living ecosystem, irrigating paddy fields, supplying drinking water, and freshwater fishes and prawns are no longer viable; its river delta and estuaries turned shallow due to heavy siltation, the water pumps supplying municipal water frequently clog due to silts, and during dry spells the irrigation canals run dry due to blockages of mud and silt near the pump houses – a dear price paid in the name of development and progress.     

The 20th century has indeed witnessed an unprecedented “progress” in man’s many abilities to dominate and conquer nature.  Man has transgressed beyond their traditional role as the custodian and guardian of nature and instead has become a master that enslaves nature to the utmost benefits, only for himself. Man has crossed the fine line between being a steward of the environment and being a dominator and conqueror of the environment. The abilities to mass produce and mass consume, to transport goods and travel over long distances, to scale mountains and traverse rivers and oceans, to cultivate crops and breed animals in mass quantities over large tracts of land, and to build roads and bridges across the hinterlands are the many successes of the 20th century man, never seen before in history. But, can this trajectory of economic growth continue forever? Whether the growth is actually sustainable in the long run, and continues to support life sustainably in the coming centuries remains as an open contention. Can we continue to literally treat mother earth as an Eden where “milk and honey” flow perpetually and profusely, satisfying Adam’s and Eve’s every lusts and desires? Or is the mother earth really a temporary abode that was once a paradise, but forever lost? In our quest to restore and recover this lost paradise, we need to pursue business in the unusual way. New paradigms of economic development have to be introduced. New approaches and understanding on the concepts such as “growth and development” and “sustainability” have to be clarified in depth. New economic agendas such as the “green economy” and “bio-economy” have to be introduced and properly planned. These are the pathways that will hopefully guide us back to the lost Eden.

As Malaysia emerges to become a developing country from what was once a colonial outpost, where most of its people were peasants and traditional farmers, economic growth and development or in the Malay language pembangunan were the jargons most popularly espouse by our political leaders in their speeches over radios and televisions to explain what and how will they develop the country. Growth and development became two most recurring mantras for the last five decades since we achieve independence in 1957. Unfortunately growth is often confused and thought to be synonymous with development. Robert Goodland in a landmark article entitled The Concept of Environmental Sustainability offered a very clear demarcation of the two seemingly synonymous terms. According to Goodland, growth means to “increase in size”, whereas develop means to “improve or to expand or realize the potentialities”. While growth refers to quantitative or material increase, development is associated with qualitative improvement. Planet earth never grows in size, but the quality of the planet may develop, either for better or for worse. Quantitative growth should not be mistaken with qualitative development at all times. The two may not be synonymous compatible in all situations. While growth may be thought to be infinite, the environmental resources are finite. The scale of economic growth may exceed the capacity of the environment to absorb the impacts of growth in a sustainable manner. There are limits to growth, and development has to be sustainable. 

The debate on sustainable growth and development hinges on our grasp and understanding on the concept of “sustainability” itself. When Gro Harlem Brundtland, a three times Prime Minister of Norway, a diplomat extraordinaire and a physician, during her tenure as Chair of the United Nations Commission on Environment and Development (also known as The Brundtland Commission) garnered a worldwide consensus that nations should embark on a sustainable development pathway, many were grappling with what is precisely the meaning of “sustainability”. It was clear that there were three areas of development that would demand sustainability – the environment, the society, and the economy. For all purposes and intents, sustainability should encompass all the three areas mentioned. Sustainability can be expressed as meeting the present environmental (ecological), societal and economic needs without compromising the needs of the future generations. A society where poverty is still rampant and social equity is conspicuously missing will not achieve environmental sustainability. An economy which is continuously liquidating the natural capital from its forests and natural resources without achieving the goals of social justice and a well balanced society will not be able to achieve economic sustainability. Sustainable development should therefore integrate all three intricately related areas of human development; the society, the environment and the economy.  

Sustainability is a popular buzzword for the politicians. Many would join the bandwagon by only paying lip service without really understanding the far reaching significance of the word. In launching the New Economic Action Plan, the Prime Minister of Malaysia outlined three principles guiding the new development plan for the country in 2010: high income economy, sustainability, and inclusiveness. Beyond political rhetoric, achieving sustainability would require immaculate planning, concrete steps to be taken and long term investments to be allocated.  Theoretically a high income economy can be compatible with sustainability, only if it is non-invasive to the environment and so long as it is not threatening to nature. For nature has to be perpetually nurtured to ensure that the economy is to be sustainable. Malaysia’s blueprint for the New Economic Model (NEM) issued by the advisory body National Economic Advisory Council (NEAC) admitted that the country’s “dependence on natural resource consumption as the primary engine of growth is clearly not sustainable” and under the NEM “investment and policy decisions should only be made after full consideration of their long term impact on the society, the economy as a whole, and of course the environment”. Whether these commitments are realized into concrete actions remain to be seen.     

The Malaysian Government has announced and implemented a few initiatives to include ‘green’ economy as part of the country’s development process. The Ministry of Energy, Green Technology and Water was set-up by the government to promote ‘green’ industry in the country. Malaysia’s vision of a ‘green’ economy would see it explores tremendous potential for ‘green’ technology growth within four targeted sectors namely energy, construction, transportation, and water and waste management. But what is exactly “green economy?” Is it just another buzzword that is politically potent but economically not worthwhile for the country to pursue? The United Nations Environment Programme (UNEP) defined green economy as an economy that improves human well-being and social equity while significantly reducing environmental risks and ecological scarcities. A ‘green’ economy aims at sustaining natural capital and maintaining the long term viability of life on earth by eliminating resource depletion, reducing wastage, optimizing the use of renewable sources of energy, the production of new bio-materials and in general improving the quality of the environmental services provided by nature.
The government of Malaysia seems to be receptive to the idea of creating new opportunities to support the initiatives of becoming a ‘green’ economy nation. Two initiatives are being undertaken to help realise this goal, which are the introduction of National Eco-labelling Programme and the National Green Procurement Policy. Funding from the Green Technology Financing Scheme was also launched to support the growth of green technologies in the country. The New Economic Model (NEM) has identified five key global trends that have to be taken into serious consideration in charting our nation’s growth. One of these trends is that the whole world is undergoing a green revolution everywhere, and we should follow suit. The NEM envisioned that, and being a hotspot of biodiversity with rainforests covering more than half of our land mass, Malaysia should “embrace a leadership role in green technology and become a strategic niche player in high value green industries and services that play to our competitive advantages”. An important competitive advantage for Malaysia is the rich biological resources within the country’s land and sea territories. The NEM sees that “Malaysia’s natural resource endowment can be used in creative and sustainable ways as a base to build new, diverse, high value, high tech industries and services”.    

The constant struggle between the ruthless exploitation of nature by governments and corporations and the environmental awakening movement driven mostly by private citizens in the 20th century is probably coming to a desirable conclusion: victory is near for the environmentalists, even though at times victory is always elusive.  At the dawn of the 21st century, a new economic shift has taken shape globally, led by the developed world. Following the pathway of the Green Economy in the developed world, the rest of the world is now gradually entering into a new economy, one that is characterised as the “bioeconomy”. From a broad economic perspective, bioeconomy refers to the set of economic activities relating to the invention, development, production and use of biological products and processes to help improve human lives and societal well-being. It is a new economy based on the applications of the knowledge and discoveries made in the biological and life sciences. The applications of these technologies are expected to improve health and well-being, boost the productivity of agriculture and industrial processes, and enhance environmental sustainability. One of the core technologies driving the bioeconomy is the field of biotechnology, defined as the application of knowledge, science and technology derived from our understanding on how biological molecules and organisms work. Our recent understanding on biological processes such as the intricate functions of the smallest DNA fragments, the workings of microbes in decomposing organic matters on the forest floor, the fine techniques of rearing and releasing biological control agents in pest eradication, the use of enzymes in converting cellulosic materials into simpler compounds in ethanol fuel production– all these knowledge are being used to transform we made our medicines, improve our industrial processes and save our environment.
Due to the knowledge intensive content of the bioeconomy, the concept is often coined as the “Knowledge-Based Bio-Economy” (KBBE), an economy which would rely heavily on knowledge workers who are well educated and trained in the field of life sciences. If applied in its full rigour the impact of the bioeconomy on our national economy and the society is wide and pervasive.  Various sectors of the economy that manage and otherwise make use of biological resources such as agriculture, forestry, fisheries, food, chemicals, tourism, pharmaceuticals and energy will have their relevance in the new bioeconomy. However one challenge remains to be very formidable; by nature bioeconomy is knowledge intensive, therefore it would require a well developed knowledge infrastructure to be instituted, a rich and varied talent pool of knowledge workers to be made available and a totally conducive environment for these knowledge workers to thrive have to be in place. Developing and maintaining adequate talent pool is a strong pre-requisite to the bio-economy. Otherwise the vision of a knowledge-based bio-economy will be just castles in the air, without any entrenched foundations firmly footed on earth.

To the credit of the Malaysian government, concrete initial steps towards the adoption of the green economy & bioeconomy were charted in the National Key Economic Action Plan. Datuk Seri Idris Jala, the Minister in the Prime Minister’s Department and the Chief Executive Officer of PEMANDU presented the government’s audacious plan for the Malaysian bioeconomy at the BioBorneo Conference 2012 in Kuching, Sarawak, outlining six major government initiatives (called entry point projects, EPP) to drive the transformation of the country’s economy towards becoming a high income nation by 2020 with a target Gross National Income of USD 15,000 per capita by the year 2020). The six EPPs are:

1.      EPP 1 – the development of nutraceutical and botanical drugs from the bioactives derived from Malaysian herbal materials;
2.      EPP 6 – the development of high value oleo derivatives and the downstream processing of oil palm products;
3.      EPP 7 – the acceleration of commercialization of second generation bio-fuel from biomass;
4.      EPP 10 – the increase in renewable energy uptake by the country’s electricity generation from 1% to 5.5 % by 2015;
5.      EPP 14 – the development of high quality breeding materials in animals and crops using DNA marker technology;
6.      EPP 20 - the establishment of premium ecotourism destination through the promotion of Malaysia as a biodiversity hub.

However promising these entry point projects are, they are actually only “entry points”. There are follow-throughs that need to be carefully implemented and watched. Green economy and bioeconomy are not mere rhetorical jargons for the consumption of the politicians to win elections. These are not licenses to pillage the environment, land grab in the rainforests and further intrusions into the hinterland either. In the past decades we have sacrificed many of our natural environments in the name of poverty eradication & national development. It is also not a license to invite multi-national corporations to exploit our national resources and given access to acres of farming lands at the expense of local farmers and taxpayers money in the name of Foreign Direct Investment. Often these multinationals were given tax breaks and other fiscal and financial incentives not enjoyed by local entrepreneurs and farmers. The Malay proverb says, “kera dihutan disusui, anak yang dikendong kelaparan”, (monkeys in the jungles were milked, child in the arm left hungry). The bioeconomy’s success is therefore not guaranteed. There are many pitfalls and harnessing its potential will require coordinated policy action and meticulous planning by governments.  Corruption, greed, inefficient and inept bureaucracy, incompetency and poor resource allocation will render the governments’ entry point initiatives to suffer premature death, or worst still, becoming stillborns.

A major unresolved issue in Malaysia is the question of the sustainability of the country’s oil palm industry, one of the country’s biggest income earner. Malaysia is a world leader of the industry by enjoying the “first mover” advantage and being ahead of the curve in planting and managing huge plantation estates. However we may have become the victim of our own success. Despite the competitive advantage, the industry suffers from three major limitations, namely (1) Land scarcity – we just cannot expand anymore, (2) Labour scarcity – the industry thrives on cheap foreign manpower, and (3) Rising production costs – input costs are increasing.  These challenges are increasingly becoming real threats to the long term sustainability of the industry. The country simply cannot ignore these issues and continue its business as usual. To be sustainable the palm oil industry must make sure that it continues to operate at minimal impact on the environment from the time of planting through to processing the oil in the mills. However, the current practice in the industry, from forest clearing to the cultivation and agronomic practices, from planting the seedlings to the fruit production and finally to the processing the fresh fruit bunches at the mill – are teeming with numerous threats against sustainability, impacting a trail of many possible collateral damages to the environment along the way. Deforestration, displacement of wild animals, species extinction, destruction of watershed, soil erosion, loss of soil fertility, siltation of streams, displacement of local communities, and many more environmental and social threats.

In response to these environmental and social concerns, non-governmental organizations, the industry and government stakeholders teamed up to launch the Round-Table for Sustainable Palm Oil (RSPO) in 2004. One of the body's top mandates was to define and develop credible standards entailing what is considered as a "sustainable" palm oil production. The standard was released in 2005, containing certain prescribed principles which include “a commitment to transparency on environmental, social and legal issues; environmental responsibility with regard to waste, resource use, and climate; and responsible consideration for workers, individuals, and communities affected by palm oil production”. More than 70 producers worldwide are beginning to implement the RSPO principles as of last year, more than half of them are from Indonesia. In total about 1.5 million tons of palm oil was certified last year.
RSPO is at best “work in progress”. The greatest challenge for RSPO is to manage tensions between the market that are demanding for better and stricter criteria in defining sustainability and the pressure from growers to reduce costs but at the same time wanting to claim a price premium over certified sustainable products.  One of the most contentious issues is on the criteria of sustainability when it comes to growers opening up the forests for a new plantation area. A grower is accorded the sustainable status if it opened up forests that are deemed not “high value conservation forest”. How this is defined remains vague and it is up to the countries themselves to make the definition. In October, 2011 GAPKI (an independent organization representing 500 growers in Indonesia has quit RSPO) and in April, 2013 the Malaysian counterpart (MPOA, representing 130 members) is mulling to quit as well.   

However RSPO still commands respect and authority among the major industry consumers around the world. For example Unilever, which consume about 1.6 million tons of palm oil and its derivatives per year (amounting to 3% of world production), is making strong commitments to purchase only from certified sustainable palm oil by 2015. Unilever defines sustainability in Agriculture as “productive, competitive, and efficient, while at the same time protecting and improving the natural environment and the conditions of the local people”. The company believes that sustainable agriculture should support the following principles:
  • •        It should produce crops with high yield and nutritional quality to meet existing and future needs, while keeping resource input as low as possible;
  • •        It must ensure that any adverse effects on soil fertility, water and air quality and biodiversity from agricultural activities are minimised and positive contributions are made where possible;
  • Itshould optimise the use of renewable resources while minimising the use of non-renewable resources;
  • •        Sustainable agriculture should enable local communities to protect and enhance their well-being and environment.

There is also a widespread resistance and negative campaigning against the oil palm industry, especially in Europe. Anti Palm Oil website saynotopalmoil.com for example claimed that most of palm oil in Southeast Asia comes from unsustainable sources. They also alleged that RSPO an organization that cannot be trusted. Our local oil palm industry indeed has a long way to go to be on the path of sustainability.

Another major issue in Malaysia is the question of the sustainability of our forestry industry. Malaysia is said to be duly committed to manage her forests in a sustainable manner, not just for economic reasons but also for maintaining environmental stability and ecological balance. In order to achieve this noble objective, the government said they will continue to maintain at least 50% of its land area to remain under forest cover on a permanent basis. Out of the total land mass of 32.9 million hectares, half or about 18.9 million hectares are covered by natural forest. As mentioned in Chapter 1, out of this, a total of 14.1 million hectares of natural forests have been designated as the Permanent Forest Estate or PFE, protected through various legislations. The PFE will be permanently managed to serve the various objectives such as production, protection, social and education purposes. For purposes of conservation and education 3.39 million hectares were allocated in the form of national parks, wildlife sanctuaries and nature reserves. Beyond the PFE there are pockets of Virgin Jungle Reserves (VJR) such as Templer Park, Ampang Hills, and Bukit Damansara reserves around Kuala Lumpur city. To date, a total of 120 VJRs covering 111,726 hectares have been established in Malaysia. Taking into account the network of protected areas and the VJRs the area that has been designated for the conservation of biological diversity around the country totals about 5.19 million hectares or 27.3% of its total forested land. The cost of maintaining these assets in the most sustainable manner is also very high, estimated around MYR 1.2 billion per year, financed mostly through timber royalties and levies. The goal has always been to ensure a continuous flow of the desired environmental related products and services from the forests, without “undue reduction of its inherent values and future productivity and without undue desirable effects on physical and social environment”.

A good example worth examining is on how an otherwise wasted forest biomass could be turned into valuable natural capital or assets. By today’s timber industry practice in Malaysia as well as in other developing countries around the world, biomass from the forests where trees are harvested for timber are almost entirely wasted. The term biomass in general refers to the organic matters that are available on a renewable and recurring basis that includes trees, plant matters, offal, animal refuse and tallow from living organisms. In terms of forest products, biomass usually refers to the materials that are lower in value as compared to those that are being used for food, feed, lumber or fibre. During harvesting operations, quite a major volume of the tree biomass is left behind as “woody debris” such as the tops, branches, stumps and the roots. Only the trunks are being transported out for lumber or for pulp and paper. These “biomass wastes” are often left behind in the forest as slash piles, sometimes being burnt or just left on the forest floor to decompose.  Decomposition is a very slow process especially when the ecosystem is already being destroyed. Actually these materials are considered as waste because they are not being put to commercial use, and there is no economic value to the materials. It is estimated that the so-called waste may be as high as 75 to 80 percent of the volume of a forest stand. A study commissioned by the USDA and USDE estimated that the value of these biomass could reach USD 1 billion per year in the United States, almost all gone to waste. Now scientific and technological advances have changed on how we view these biomaterials. A range of new technologies called torrefaction where woody biomass are being burned or underwent pyrolysis at temperatures typically ranging between 200 and 320 °C in order to obtain a much better fuel quality for combustion and gasification applications.
One may rightly say that the paradise that was of our rainforests and natural ecosystems are already lost, probably forever. The collateral damages on the environment brought by decades of unsustainable logging practices and massive clearing of virgin forests to give way to agriculture were too detrimental and had been very costly. However, the pathways to restore our lost paradise seem to be quite clear and the beacons of hope can be seen in the horizon, but not devoid of challenges and obstacles. We may have to pay dearly to recover this paradise. 

References
1.   
  1. Goodland, Robert. The Concept of Environmental Sustainability. Annual Review of Ecology and Systematics, Vol. 26 (1995), 1 – 24.
  2.  National Economic Advisory Council. The New Economic Model. 2010.
  3. OECD. The Bioeconomy to 2030: designing a policy agenda. OECD Publications (2012).
  4. Columnist – Making palm oil sustainable. New Straits Times. 22 Dec 2011.
  5. RSPO
  6. Unilever
  7. Ambak & Zakaria

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