Published 02 May 2023
The significant inflow of FDI in Southeast Asia created jobs and made substantial contributions to economic growth, but challenges remain in fostering an investment climate for sustainable investment that furthers social and environmental objectives. Watch a recap of a panel discussion on the issue organized by the Hinrich Foundation and the US-ASEAN Business Council.
The panelists discussed the findings of a recent Organisation for Economic Co-operation and Development (OECD) report Enabling Sustainable Investment in ASEAN co-sponsored by the Hinrich Foundation that provides insights on how governments and businesses can jointly promote investment for social and environmental objectives. The webinar brought together stakeholders from the ESG and digital sectors.
- Ambassador Ted Osius, President & CEO of the US-ASEAN Business Council, in his opening remarks, highlighted the importance of an open and transparent policy framework for investment design and implementation.
- Kathryn Dioth, Chief Executive Officer of the Hinrich Foundation, talked about the importance of FDI and trade in creating jobs and raising living standards. Citing China’s example, she noted how FDI is responsible for 33 per cent of China’s GDP and 27 per cent of its employment. Contrastingly, she referenced data from OECD which shows that FDI in ASEAN has fallen by 43 per cent in developing markets, stressing the need to pay greater attention to the conditions for FDI to flourish.
- Alexandre de Crombrugghe, Head of Investment Promotion and Facilitation at OECD, presented a recent report by the OECD on enabling sustainable investment in ASEAN. He discussed the three main chapters of the report briefly: 1) Reforms and strategies to promote sustainable investment, 2) Promoting responsible business conduct, and 3) Promoting investment for green growth. Using various tools, the report measures how effective certain ASEAN markets are in attracting FDI and the various challenges they face. The report also recommended responsible business conduct (RBC) in ASEAN to promote sustainable investment in the region.
- Genevieve Ding, Public Policy Head of Sustainability Strategy for Asia-Pacific and Japan, Amazon Web Services, shared that the region should be prioritizing the energy and nature sectors. She noted that the choice of investment locations for investors outside of the energy sector is more tightly linked to broader investment climate conditions in destination economies than the strength of national climate policies. Due to the limited availability of renewable energy, regulatory complexity, and high costs, the Asia Pacific and ASEAN markets remain the most challenging in the world for businesses seeking 100% renewable energy.
- Richard Lomas, Senior Vice President of Government Affairs Asia Pacific at Citi, began by reiterating the need for a reduction of global emissions by at least 40 per cent to meet Net Zero targets by the middle of the century. However, emissions continue to rise, and the financing required to meet those targets remains inadequate. Against that backdrop, Richard stressed the importance of financial institutions in stewarding firms to work on their own transition plans to achieve their respective net-zero targets.
The webinar was moderated by Ambassador Michael W. Michalak, Regional Managing Director, US ASEAN Business Council, and Chuin Wei Yap, Program Director, International Trade Research, Hinrich Foundation.
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