25/07/18

“Private sector can be a powerful catalyst in boosting the resilience of our economies” – Minister Responsible for Climate

Fiji’s Attorney-General and Minister responsible for Climate Change, Aiyaz Sayed-Khaiyum, delivered the opening remarks at the Global Employers Climate Action Forum in Suva, Fiji, on 25 July 2018.

I’ll give you a very brief position of Government in particular in relation to the Private Sector and the position that the Fijian Government has taken in respect of the honour indeed that we were given vis-a-vis COP23.

The eyes of the world are on the Pacific this morning, as we open the Global Employers Climate Action Forum. Governments, businesses and citizens are looking to us, because we – our people and our economies – are on the frontlines of climate change, and it is we who must set a bold example in how the public and private sectors can work together to drive decisive climate action.

We are very glad to see that businesses from across the region are so well represented here this morning. Whether you are working in tourism, manufacturing, construction, finance, or whatever industry your business is in, you all have experiences, knowledge and expertise that can help us deliver on our climate action agenda, here in Fiji, indeed the region and the Pacific and of course taking our experiences to the global stage.

As Pacific men and women, we know what we’re up against. We’ve all endured the devastating impacts of cyclones, rising seas, other climate impacts and inclement weather. We’ve all been witnesses to the damage caused to your national economies and communities, and the serious impact that climate change has had on our bottom line. Its far more than a matter of social responsibility, it’s a question of survival of the very economies in which you operate and indeed it also requires us to become a lot more innovative.

In a very practical way, you understand the serious risk climate change poses to the health and development of Pacific economies, and that is what makes you invaluable partners in our campaign for climate action. Those from our tourism sector in Fiji know just how lucky we were that Cyclone Winston in 2016 largely spared our major tourism sectors. So despite the total cost of damages amounting to one third of the value of our GDP, we could have faced an economic crisis of even more catastrophic proportions.

As our Honourable Prime Minister said, we are all in the same canoe when it comes to climate change. Our response must be collective, and it will take input and action from all of us. That commitment to inclusion is the spirit behind the Fijian Presidency of COP23, and the very impetus behind the participatory process of the Talanoa Dialogue, which will take centre stage at our Climate Action Pacific Partnership event this week.

This Forum, especially in the context of the CAPP Conference, is our chance to show how here in the Pacific, Governments, the private sector and individuals are working side-by-side to build the resilience of our people, our infrastructure, our environment and our economies – and especially our businesses – against the worsening impacts of climate change.

Because while we do face extreme risks, in that there is still opportunity; an opportunity to put ourselves on the cutting edge of solutions in adaptation, to make the Pacific an incubator for strategies in building resilience that can be adopted by climate vulnerable nations around the world.

Our shared recognition of the need for urgent action is the very foundation of our engagement through this forum. And that recognition is captured in this forum’s theme, “Resilient Businesses and Communities”.

Resilience, in this context, is two-pronged. It involves the responsible reduction of greenhouse gas emissions to at least net zero levels, and it requires we urgently boost the ability of businesses and communities to withstand the stronger storms, rising seas, changing weather patterns and other devastating impacts of climate change. Both of those objectives are critical for the long-term development of our economies, and the long-term health of our businesses.

This forum builds on the work of the Marrakech Business Action for Climate Presidency as highlighted by the President of Employers Federation which was handed over the Fiji Commerce and Employer’s Federation at COP23, with the mandate of forging partnerships between the private sector, governments and other actors to meet our Nationally Determined Commitments under the Paris Agreement.

We’ve seen the private sector make serious progress in that regard already. Through the Talanoa Dialogue, we’re calling for even more ambitious climate action from every actor in every economy and that includes sub-national governments, companies and members of civil society.

As Governments, it is our job to not only guide sustainable development, but to foster an environment that allows the private sector to do what it does best; innovate, improve efficiency and create sustainable employment for our people. That potential in the private sector can be a powerful catalyst in boosting the resilience of our economies. Here in Fiji, we’re harnessing that potential, leading by example at the government level with responsible, climate-sensitive strategies, and introducing new policies that incentivise green investment in our economy.

In Fiji, we remain on target to approach 100 per cent renewable energy in Fiji by 2030. Last year, we successfully implemented a ten cents levy for example on plastic bags, and in our latest national budget we’ve doubled that levy, in line with our most recent commitment to ban single-use plastic bags entirely by 2020.

We’re forging public-private partnerships here in our country as well, most recently in the delivery of affordable clean energy to rural communities across Fiji through the Fiji Rural Electrification Fund. We’ve actually established a charitable trust, with initial seed funding from the Leonardo DiCaprio Foundation, to build mini-solar grids in Fijian communities currently reliant on polluting diesel fuels. The aim being to make these communities self-sufficient clean energy producers, bringing the enormous benefits of reliable of solar power to Fijians in more remote parts of the country.

Our national energy provider, Energy Fiji Limited, is continuing to grow its renewable energy portfolio, investing in hydro dams and – in the near future – in large scale solar farms.

More of our manufacturers and tourism operators are installing solar rooftop panels. For example, the Coca-Cola factory just outside of Suva in Nasinu now operates a 1.1 Mega Watt solar rooftop system; the largest privately-funded solar grid in the South Pacific. We’ve also seen companies such as Mark One apparel in Suva, the Denarau Marina and the Radisson Blu Resort on Denarau Island, lead the charge among private sector operators in lowering their own emissions.

Another great example of private sector investment is the development of the Nabou Biomass Power Plant outside Sigatoka that uses biomass for clean energy generation.

These are a few examples of how the private sector can help bridge the sustainable financing gap brought about by limited Government resources, which is particularly important in developing countries like Fiji and the rest of the Pacific.  That is why we need the right mix of attractive policies and market mechanisms to crowd in private sector finance and generate attractive returns for investors. We also need Government donors and multilateral development agencies to help provide measures that de-risk investments, and that’s a topic I will speak on in greater detail during the CAPP Conference tomorrow.

We’ve considered our own situation in Fiji, and took the initiative to venture into the global capital market to raise funds for sustainable development projects that address climate change and preserve the health of our natural environment.

Fiji became the first emerging economy – and the third in the world – to issue a sovereign green bond – worth FJD 100 million in modest it may be, however to support climate mitigation and adaptation initiatives. The Fijian Sovereign Green Bond is an innovative financial instrument that will help finance projects in Fiji that protect the progress of the Fijian economy, and fulfil our own obligations under the Paris Agreement, and we expect this finance will also be used to leverage private finance as well.

We of course listed the Green Bond in the London Stock exchange recently during the Commonwealth Heads of Government.

Even with early stage private sector and philanthropic investment in climate action in the Pacific, it is Governments that need to further drive climate action at the national level through responsible fiscal policy.

In Fiji, that has taken the form of our Environment and Climate Adaptation Levy, our latest domestic fiscal tool to crowd public finance towards programmes that adapt our economy to climate impacts and protect our natural environment. ECAL as its known, has revamped our taxation policy into a consolidated fiscal mechanism built on transparent and efficient tax collection administered by the Fiji Revenue and Customs Service. And ECAL Funds have already gone towards the construction of new, cyclone-resilient schools for Fijian students, more capable infrastructure, renewable energy projects and a myriad of other climate adaptation and environmental protection initiatives.

All of the climate-sensitive development funded by ECAL, and all of our work across the country to build the resilience of our infrastructure and of Fijian communities, benefits Fijian businesses. Whether it be upgrades to our roads, the Nadi River Flood Elevation Project, the installation of a new cross ocean data cable connection to Savusavu, the relocation of water pipes to secure roadside trenches, or the installation of underground electricity and telecommunication cables, all of that work supports a strong and growing economy, and gives Fijian businesses the opportunity to grow in an economic environment that is resilient to extreme climate impacts.

And of course things like building electricity cables underground means down time for electricity cables being blown away by a cyclone is actually minimal in fact its zero.

We’re also using our own fiscal policy to drive private sector investment. For example, to reduce our dependence on imported fossil fuels, we’re offering a ten-year tax holiday for those looking to process bio-fuels, that includes the duty-free importation of essential machinery and equipment to establish a processing plant and chemicals required for bio-fuel production, along with zero-rated importation for all agricultural items.

We’re also offering tax holidays towards new renewable energy projects and power cogeneration, along with duty free importation of select renewable energy goods, including electric motor vehicles, hybrid vehicles, hybrid solar electrical powered items, solar and electrical charging stations and energy storage systems. We’ve introduced a new investment incentive package for the redevelopment of privately owned buildings, which includes requirements that owners must utilise a green technology, such as solar panelling, on their redeveloped building.

But the reality is – no matter what we do at home – our fate will ultimately be determined by the collective action taken by the nations of the world. On the global stage, it’s become clear that current Nationally Determined Commitments fall well short of the goal to keep global temperature rise to 1.5 degrees Celsius above pre-industrial levels.

We badly need increased ambition in the next round of NDCs. To support Pacific Island Countries to enhance and implement their own NDCS, a Regional Pacific NDC Hub was launched by our Honourable Prime Minister in Bonn during the COP23 negotiations. It was an initiative that came from last year’s Climate Action Pacific Partner Conference we are pleased to see come to life.

We encourage the private sector to involve yourselves in the review and implementation of your country’s NDCs as well, particularly to help inform governments as to what is required to incentivise partnerships and greater green investment. And that’s a subject of discussion we hope we’ll explore during your afternoon sessions.

We cannot stress enough how important your open and constructive input is to our domestic agendas, and to our larger campaign on the global stage. We are all very much a part of our process of Talanoa Dialogue, our Pacific approach to identify solutions, innovations, approaches and strategies that drive countries to maximise their climate ambition. It is this inclusive and transparent process of dialogue that we believe gives us our best shot at achieving the goals of the Paris Agreement.

We hope those same principles of respectful and participatory dialogue guide your discussions over the coming day, and all the way through our Climate Action Pacific Partnership Conference tomorrow.

I’d like to thank you all of you for your participation and thank all of you for your presence here and wish you all the best in your deliberations.

Vinaka vakalevu. Thank you.