Pursuing climate action in the Bangladesh apparel industry | The Daily Star
12:00 AM, February 01, 2021 / LAST MODIFIED: 01:10 AM, February 01, 2021

Pursuing climate action in the Bangladesh apparel industry

Public-private partnerships could help us take the crucial steps forward

Many of us will have heard the story of the boiled frog. Legend has it that if you put a frog in a pot of boiling water, it will instantly leap out. But if you put it in a pot filled with pleasantly tepid water and gradually heat it, the frog will remain in the water until it boils to death.

A parallel to this can be drawn with the global challenge we now face around climate change. We seem to be sleepwalking into a disaster of our own making. Each year that passes, we hear the same speeches, the same discussions. Yet we continue to make the same mistakes, setting targets which lack ambition and urgency and taking the easiest possible road.

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As citizens and businesses of the world, we have extracted the earth's natural resources at an alarming rate. According to some estimates, we now consume natural resources at a rate that is 1.7 times higher than they are being regenerated. This is thanks to population growth and the disposable society in which we live.

During the recent virtual Climate Change Ambition Summit, Antonio Guterres, Secretary-General of the United Nations, expressed his fear that the global temperature may rise by up to three degrees Celsius if countries belonging to the G-20 are unable to drastically reduce their emissions. We already know that a global temperature increase of just one degree Celsius would lead to an overwhelming environmental hazard. What would happen if temperatures rose by three degrees Celsius? Especially in countries such as Bangladesh, which have been identified as susceptible to climate impacts?

Many countries belonging to the Global North have already strengthened their climate response agenda to address climate change. The United Kingdom, Canada and Japan have pledged to achieve carbon neutrality and net-zero emissions by the end of 2050. Joe Biden, the present US President, has signed an executive order to have the United States rejoin the Paris Agreement. In Asia, India and China have vowed to cut down a significant portion of carbon emissions by 2030. China envisages bringing down its carbon emissions by at least 65 percent by the end of 2030. India too is on track to reduce carbon emission to 37-39 percent below its 2005 levels.

The United Nations Climate Action Plan outlines a massive transformation of operations to attain a 45 percent reduction in carbon emission and an 80 percent sourcing of electricity from renewable energy by 2030. In this regard, Bangladesh has developed a Nationally Determined Contributions (NDC) document following the UNFCCC guidelines under the Paris Agreement.

However, the NDC only articulates a mandate of achieving at least 10 percent of total power generation from renewable energy sources by 2030. The recent 2021 database of electricity generation mix reveals that only 3.22 percent of it is derived from renewable sources. What these figures show is that there is a sharp disconnect between our national mandate and the global mandate.

We need to address this, as a country and garment industry. We cannot afford to overlook the various global climate pledges, because our biggest RMG export markets lie in Europe (60 percent), USA (18 percent) and Canada (four percent).

In order to keep pace with global buyers, it is essential that the climate targets in Bangladesh are aligned with the most ambitious targets globally. We must lead, not follow, on this issue and be proactive, not react when things are too late.

There are other factors at play. Our government has prioritised Bangladesh's LDC graduation by 2024 in the Eighth Five Year Plan (FYP). The Plan has a heavy focus on climate change and environmental sustainability. Look closely at the plan and it is clear that its success—our ability to meet national climate goals—largely depends on the private sector. That means investment in new, green technology from our RMG industry. Is the money there for the investment? Can factories get access to the necessary investment collateral?

There are pockets of finance available but this is a hit and miss field. Factories face struggles to accessing finance, whether due to a lack of collateral or, in some cases, because the application process for green finance is complex and cumbersome.

The other factor, which is rarely discussed, is that even if all RMG factories in Bangladesh installed solar rooftops, they would merely be capable of substituting around 10 percent of non-renewable energy. In other words, our industry is not only not doing enough at present but it still won't be doing enough if it makes investments in solar energy.

In other words: we need to do more, and we need to be far more ambitious in our targets. We need radical change. If not, we face playing a part in our own climate catastrophe (as well as losing many of our major customers who are now looking to slash emissions in supply chains).

So what is the solution? The government of Bangladesh is addressing climate issues via two funds, one being the Climate Change Trust Fund and the other being the Bangladesh Climate Change Resilience Fund. To this end, an obvious way forward is a far-reaching collaboration between the public and private sector, namely a public-private partnership (PPP).

A PPP of this nature could facilitate the sharing of capital expenditure (CAPEX) investment in renewable energy production, where say 40-50 percent would be financed by the private sector and the rest covered by the public sector.

An interconnected issue is land—or lack, thereof, for solar installations. A possible solution here may be a land lease agreement between the two sectors, where the public sector provides land to the private sector for the lifetime of a solar installation period of 25 to 30 years.

Another necessary policy instrument to facilitate this may be industrial clusters completely powered by renewable energy sources. Suitable locations could be existing industrial clusters like Ashulia, Gazipur, Tangail, Mymensingh, Narayanganj and Chattogram, where there are already established or potential business. These clusters are also hubs of urbanisation, which means the excess power generated from the solar photovoltaic systems may act as an excellent source for meeting the surrounding community's energy demands.

All of this is, of course, pie in the sky unless we have an ambitious, far-reaching and world leading national zero emission plan. Net zero has to be the goal and this must be time-bound, in keeping with the targets set by leading nations and Bangladesh's customers.

The time for talking is over where climate is concerned. If we don't wake up to these issues now, we will be the perpetrators of our own downfall.

The tools to address climate issues are there. Public and private sector must work together and use them.

 

Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Apparel Exchange (BAE).

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