Greening the Philippine Manufacturing Industry Roadmap Process

1

Greening the Philippine

Manufacturing Industry

Roadmap Process

Industry Roadmaps and AEC Gameplan:

Roadmap Localization for Competitiveness

12 May 2016

Hotel Roma, Tuguegarao City

Cagayan Valley Region 2

Klaus Peter “Pitt” Berkemeyer

GIZ ProGED Adviser

Presentation Outline

Green Economic Development and its linkage to the

Industry Roadmap Process

Brief introduction of GIZ and ProGED project

Climate change - a challenge for developing economies

Conclusions

Major findings and recommendations

GIZ - International Cooperation

Company for the German Government

Operates in over 130 countries worldwide and has around

16,000 staff, 70 % are locally employed national personnel

GIZ - Deutsche Gesellschaft für Internationale Zusammenarbeit

Owned by the Federal Republic of Germany and organised as a

private-sector company

Supports international development cooperation on behalf of

the German Government and other stakeholder

Corporate purpose is, to support German Government

objectives towards international cooperation for Sustainable

Development around the world

Project Name: Promotion of Green Economic Development

Objective: Philippine MSMEs as well as government institutions

relevant to economic development increasingly implement

environment friendly, climate smart and inclusive strategies and

measures.

Time Frame: 01 January 2013 – 31 December 2016

Main Partner: Department of Trade and Industry (DTI) with its

Regional Operations Group (ROG)

Beneficiaries: Micro, Small and Medium Enterprises

ProGED - Promotion of Green

Economic Development

R III

R IV-A R V

R VI

R IV-BR VII

R XIII

Albay

Palawan

Camarines Sur

Surigao del Norte

Bulacan*

Catanduanes*

Sorsogon*

Masbate*

Siquijor

Bohol

Cebu

Nueva Ecija*

Tarlac

Pampanga

Occidental Mindoro

Capiz

Aklan*

Iloilo*

Guimaras*

Negros Occidental

Rizal*

Laguna

Cavite

Quezon*

Batangas*

Pilot area 2013

Replication areas 2014

Replication areas 2015

*Replication areas 2016GED initiatives by DTI

Agusan del Norte

Agusan del Sur*

Camarines Norte*

Negros Oriental

R XVIII

Climate Change – a challenge for

developing economies

Abrupt Climate Change

The years from 2000 till 2015 comprise the hottest years

ever recorded with 2015 the hottest year ever

In 2015 the average global temperature breached the 1℃

degrees Celsius threshold to pre-industrial levels

January to December 2015 showed already figures of

1.02℃ above the average between 1850 and 1900

Most scientist predict a rise to 2℃ which they regard as a

limit of safety. Above impacts would be catastrophic

In climate negotiations island states (including the

Philippines) claim that a temperature rise of 2℃ is already

too much and opt for 1.5℃

It wasn’t always like that

Global temperature development

from 1880 to 2015

Climate Change – a challenge

for developing economies

1960 2010 2050

2010 - 2050 Ecological footprint scenarios

Moderate business as usual

Needed eco footprint reduction

1.0

Source: Global Footprint Network

Biocapacity:

The capacity of ecosystems to produce useful biological materials and to

absorb waste materials, using current management schemes. “Useful

biological materials” are those demanded by the human economy.

CHINA

1.0

PHILIPPINES

1.0

1960 - 2011 Ecological footprint history

Biocapacity

Ecological footprint

Ecological Footprint: A measure of how much area of biologically

productive land and water is requires to produce all the resources it

consumes and to absorb the waste it generates.Source: Global Footprint Network


for developing economies


for sustainable industry development

Green Economy and its linkage

to the Industry Roadmap Process

The Key Challenge

The worldwide dynamics of industrial development

and the integration process of the ASEAN Economic

Community challenge the manufacturing industry

in the Philippines to position itself as a

globally competitive industry that is successful on

domestic, regional and global markets

Green Economic Development is a driver for

competitiveness, innovation, new markets, jobs

inclusive growth and poverty reduction

A green economy is, where growth in income and

employment is driven by public and private investments

to reduce carbon emissions and pollution, enhance

energy and resource efficiency, and prevent the loss of

biodiversity and ecosystem services (UNEP)

social

community

natural

environment

sufficient

economy

Resource

responsible

environmental

responsible

social

responsible

SUSTAINABLE

DEVELOPMENT

The model of a sustainable

inclusive growth economy

Strategy Development for

selected industry sectors

Green economy processes should be an integral part of the

modernization strategies of a sustainable Philippine industry

Automotive and Car Parts Industry

Pulp and Paper Industry

Plastic Industry

Furniture Industry

Housing Industry

Copper Industry


Manufacturing Industry Roadmaps

Previous Missions

July 2014: Analysis of the overall situation and meeting with

industry associations and other stakeholders

November 2014: One-on-one discussions with six

industries to assess possible integration of GED

March 2015: “Greening Manufacturing and Increasing

Competitiveness Forum”

Integration of Green Economic Development in

industry sector policies of the Philippines Roadmaps

Climate smart, environment friendly and globally

competitive industries

GOALS

Mission in August 2015

Trade and Industry Development Talk with Industries, BOI

champions and government departments August 2015

All industry associations reported on encouraging steps towards

greening their sectors, NGAs like DENR and DOE responded

Specification of the role of DTI on Green Economic Development

Supporting selected industry associations to specify their focus

on Green Economic Development

Presenting strategic options of GED at the “Industry Roadmaps

and the AEC Game Plan: Regional Roadmaps for

Competitiveness” on 6 August 2015 in Tagaytay City

Strengthen the awareness building and

an institutional development process



Greening Manufacturing Industries

and Increasing Competitiveness Forum

March 2015



Trade and Industry Development Talk

August 2015

Linking the Roadmap Process to

Green Economic Development

ProGED’s input:

Why and how Green Economic Development in the

manufacturing industry

DTI and BOI acknowledge the importance of a green

modernization of the industry sectors

The Industry Roadmap Process is seen as a unique

opportunity to define a transformation to and promotion of

an industry driven Green Economic Development

comprehensively addressed within the overall

Roadmap Process

integrated into selected sector roadmaps

Major findings and recommendations

Responding to new challenges

Attracting foreign investments needs climate change

resilience:

The industry of the Philippines perceives foreign investments as a

key for strengthening its competitiveness. But favorable investment

conditions (infrastructure, service provision, etc) are needed.

Future competitiveness as a nation, province or municipality will

depend on how green and climate resilient our economy is:

If energy prices are high and supply unreliable, nobody will invest

If air pollution is high, health-related costs increase and makes

the place unattractive so that the talented people go elsewhere

If soil quality is worsening, food supply chains become

unproductive and uncompetitive

If natural disaster happen more frequently, local business are

interrupted and global supply chains look elsewhere for

alternative suppliers

Shaping favorable

framework conditions for investment

RESOURCE EXPLOITATIONCHEMICAL POLLUTIONTRAFFIC CONTAMINATIONWASTE DISPOSAL

HIGH COSTS OFCLIMATE CHANGE IMPACTS

Greening makes industries competitive because:

it develops environmental value conciseness and

reduces cost of production using materials, power, fuel,

water more effectively

it promotes access to new and higher value markets

it facilitates innovation, new products and processes

it helps to make industry sectors more resilient to climate

change impacts

Strategic arguments for

industries to go »Green«

Green business strategies can offer solution to the negative

impacts of climate change on industry sectors

Learn how to adapt; green growth can enhance the

management capacity, foster competitiveness and ensure

their company’s sustainability and survival

What is »Greening«?

The change of business strategies, processes, practices

and technologies to improve the efficiency in the use of

power, water, resources, raw materials etc.

Understand the responsibility for natural resources and

reduce adverse impacts on the environment as a business

objective

Reduce soil, water and air pollution by improve solid

waste and waste water management

Reduce business risks related to climate change impacts

and plan accordingly

Produce and promote green products and services

Strategic Options

Energy efficiency and renewable energy:

By increasing the energy efficiency of their operations,

companies can significantly reduce production costs and

contribute to mitigation of GHG emissions

Resource Efficiency:

By improving business processes, not only production costs

can be reduced but costs for the management of waste,

toxic waste and wastewater as well and reduce the

ecological footprint

Strategic Options

Meeting international production and process

standards:

Participating in global supply chains and having a good

standing on major markets depends highly on good quality

product and service delivery. Good quality is the result of

well organized business processes that are aware of

international production and process standards relevant for

their main markets

Greening measures

Improved waste management

Natural lighting

Clustering of delivery trips

Calfurn Manufacturing Philippines, Inc.

Savings

Annual savings in electricity PhP 400 000

Annual Savings from diesel PhP 230 000

Greening measures

Optimization of defrost cycle

Reuse of condensate to cool boiler

Mekeni Food Corporation

Savings

Annual savings in power PhP 3.500 000

Annual Savings from diesel PhP 945 000

Friendship Wash and Dry

Greening measures

Proper insulation of steam lines

Construction of septic tanks for wastewater treatment

Conversion of boilers from fuel to wood burning

Savings

Annual savings in chemicals PhP 283.000

Annual savings from fuel PhP 2.600.000

Annual savings from heat loss PhP 110.000

Savings

Annual savings in power PhP 1 150 000

Greening measures

Changing bulbs

Modernize Equipment

Synchronization of generator and power supply

Yokohama Tires Philippines Inc.

Greening strategies are beneficial,

some industry examples

Source: EU Green Philippines Project

Recent Developments in the

Philippines promoting GED

GP3

Green Expo

and

Conferences

Energy

Efficiency Law

Energy

Efficiency

Roadmap

Renewable

Energy

Development

Feed-in-Tariff

and Net

Metering

Update of the

National CC

Action Plan

Green Public

Procurement

Philippine

Contributions

to COP 21

Eco Labelling &

Certification

Green Jobs ActGreen

Financing

Electric Mobility

Emission

Standard

Euro 4

Legislating

Green Building

Standards

Green Building

Code of DPWH

Sustainable

Tourism

Ecotourism

Conclusions

Conclusions

Greening = Strengthening systemic competitiveness

and fostering inclusive green growth

“Green” is not to be seen as an add on, but as a key driver

for innovation

GED inherent in management, process technology and

product innovation

The Philippine industry would have to adopt at least

minimum standards to become competitive

On top potentially ISO 14000 / 50000 Environmental /

Energy Management Systems

Conclusions

Automotive industry, mass housing and plastic industry

are already facing market pressure and are moving into

the “Green Economy Direction”

Others industries should do the same and follow suit

with replication initiatives

DTI and BOI should take the lead in proposing and

implementing a systematic and coherent approach

towards Green Economic Development

The Philippines’ entrepreneurial way towards globally

competitive and innovative industry and service sectors

should follow this pathway:

From a “Resource Based Economy”...

via an “Efficiency Based Economy”...

towards an “Innovation Driven Economy”

In other words

Maraming salamat po

Vielen Dank

Thank youwww.greeneconomy.ph

2015 Landmark events for

green growth and

sustainable development

24 May 2015

Pope Francis’s encyclical letter “Laudato Si’

on Care for our Common Home”25 September 2915

From Millennium Development Goals MDGs

to Sustainable Development Goals SDGs

15 December 2015

COP 21 – United Nations

Framework Convention on

Climate Change (UNFCCC)

Several events in 2015

27th ASEAN Summit

on 21/22 November 2015Multiple events in 2015

Summit on 18/19 November 2015

Asia Pacific Economic Cooperation

APEC

3rd World Conference on Disaster Risk Reduction

14-18 March 2015

Sendai, Japan

“While the post-industrial

period may well be

remembered as one of the

most irresponsible in history,

humanity at the dawn of the

twenty-first century will be

remembered for having

generously shouldered its

grave responsibilities”

The Holy Father Pope Francis

APEC 2015 – Business events

acknowledge Green Growth

“We are firmly committed to achieving a fair,

balanced, ambitious, durable and dynamic a

greement on climate change at the Paris

Climate Conference in December

We therefor reaffirm our aspirational goals

to reduce aggregate energy intensity by

45percent by 2035 and double renewable

energy in the regional energy mix by 2030

to achieve sustainable and resilient energy

development within the Asia-Pacific.”

Manila Declaration on Climate Change of the Philippine

Private Sector, October 2015

Conference of Parties (COP) 21

A total of 36,276 participants, of whom 23,107 were official government delegates, have attended the COP 21 events

In order to reach a new universal climate agreement, the delegates of the 196 States Parties to the United Nations Framework Convention on Climate Change (UNFCCC) have finally agreed on the treaty on 11 December 2015

“As President of a nation

increasingly affected by the

new normal, I believe the

real challenge begins with an

accounting of capacities:

How do we ask everyone to

contribute, and how do we

ask those with more to help

out those with less?”

Benigno S. Aquino III, President of

the Philippines

Key Messages to COP 21

COP 21 Commitments of the

Philippines

The commitment of the Philippines to address climate

change is to reduce carbon emissions by 70% by 2030.

This is conditional to international assistance, as stated in

its Intended Nationally Determined Contribution (INDC)

submitted to UNFCCC in October 2015

The reduction will come from the country’s energy,

transport, waste, forestry and industry sectors

CCC Commissioner Emmanuel de Guzman called for a

global warming target less than 1.5 degrees Celsius

Greening the Philippine Manufacturing Industry Roadmap Process

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