THE PHILIPPINES needs to budget more effectively and tap more financing for its climate-change mitigation efforts, given the limited internal resources available to meet its international commitments, the Asian Development Bank (ADB) said.
“With only 2.7% of the 75% (emissions reduction) target to be financed through the public budget, turning ambition into delivery will depend on how the country’s climate program is financed,” the ADB said in a blog post on Tuesday.
“Effective government budgeting is key to building institutions, as well as the teams of people needed to convert climate ambition into action… maintaining and increasing budget allocations — from the 6.27% of the annual budget allocated for climate resilience in 2021 — will be critical,” it added.
In 2021, the Philippines committed to reduce 75% of its emissions by 2030, one of the more ambitious targets in Southeast Asia.
“Not surprisingly, addressing climate change is a consistent priority across the country’s leadership, whether in government or management of large companies,” the ADB added.
“Living in one of the world’s most vulnerable countries to climate change, people in the Philippines face an increasing barrage of cyclones, floods, drought and heatwaves. The country is hit with an average of 20 typhoons per year, and over 3 million people are affected by extreme floods,” the ADB said.
On the prospects for tapping international financing, the ADB said: “The Philippines’ climate ambitions will not be met without support from development partners and philanthropies.”
Between 2018 and 2020, donor governments and multilateral institutions provided $2.4 billion in climate-related development finance.
“More of these funds are needed, and fast. A pipeline of projects needs to be built, and project sponsors need more capacity to mobilize funds, design projects and engage investors,” it added.
Banks will also play a key role in financing the bulk of climate initiatives within the country, the ADB said.
“The central bank and other financial regulators have put in place a suite of policies to integrate environmental, social and governance issues into banking practice; encourage green lending; and support banks considering how climate risks affect their lending. Banks and financial institutions need greater capacity to take on this agenda,” it added.
The ADB also cited private investment in clean energy and mobilizing local governments as key to implementing more climate-resilient projects.
“The clock is ticking for the Philippines, and the money needed for climate action cannot be mobilized fast enough,” it added. — Luisa Maria Jacinta C. Jocson