fy 2014 program to reduce global warming emissions

1

FY 2014 PROGRAM TO REDUCE GLOBAL WARMING

EMISSIONS FROM NON-ENERGY RELATED ACTIVITY

OVERSEAS Visualizing the Contributions of Japanese Firms to

Adaptation Measures in Developing Countries

(Summary Report)

March 2015

Nomura Research Institute, Ltd.

2

FY 2014 PROGRAM TO REDUCE GLOBAL WARMING EMISSIONS FROM

NON-ENERGY RELATED ACTIVITY OVERSEAS

Visualizing the Contributions of Japanese Firms to Adaptation Measures

in Developing Countries

(Summary Report)

―Contents―

1. Surveying Japanese firms’ potential contribution to adaptation measures in developing countries ........ 3

1-1. Call for tenders for feasibility studies and results ................................................................................... 3

1-2. Summaries of studies of projects selected ............................................................................................... 3

1) Kaiho Recycled Farm Equipment Rental Business (Kaiho Sangyo Co., Ltd.) .................................. 4

2) Disaster Prevention and Mitigation to Counter Increase in Landslide Disasters due to Climate

Change in Thailand, and Application to Countries in the Greater Mekong Subregion

(Kawasaki Geological Engineering Co., Ltd.) ................................................................................... 6

3) Organic Waste Composting in the Maldives (PEAR Carbon Offset Initiative, Ltd.)......................... 8

4) The Forest Wisdom Project (from far east inc.) ............................................................................... 11

5) Feasibility Study of High-Quality Mung Bean Cultivation in High-Salinity Areas of

Bangladesh (euglena Co., Ltd.)........................................................................................................ 13

2. Identification and consideration of policy concerns .............................................................................. 15

2-1. Consideration by Adaptation Advisory Panel of feasibility study performance .................................... 15

2-2. Identification of policy concerns ........................................................................................................... 15

1) Policy concerns regarding action by Japanese firms in the field of adaptation ............................... 15

2) Global developments and Japanese government policy regarding adaptation ................................. 17

3. Raising the international and domestic profile of Japanese initiatives .................................................. 20

3-1. 21st National Convention of the Japanese Academy of International Business Studies ....................... 20

3-2. METI symposium on “The Contribution of Japanese Technologies to Adaptation to Climate

Change in Asia, Africa, and Island States: Responding to Developing Country’s Needs and the

Evolution of Global Business ................................................................................................................ 20

4. Roundup of results ................................................................................................................................ 22

4-1. Ongoing sharing of information on results to date ................................................................................ 22

4-2. Where next for adaptation policy? ........................................................................................................ 23

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1. Surveying Japanese firms’ potential contribution to adaptation measures in

developing countries

1-1. Call for tenders for feasibility studies and results

For this program, feasibility studies (“adaptation FSs”) were made of the potential for outstanding

Japanese technologies and other resources to be used in adaptation activities to help manage the effects of

climate change in countries that are particularly vulnerable to climate change.

Tenders to perform these adaptation FSs were invited between July 18 and August 15, 2014, and

proposals were received from organizations and consortiums located all over Japan. The proposals were

carefully considered by a panel of outside experts, as a result of which five were selected (Figure 1).

Figure 1 Projects selected for adaptation FSs

Business name (lead enterprise) Project title

Kaiho Sangyo Co., Ltd. Kaiho Recycled Farm Equipment Rental Business

Kawasaki Geological Engineering

Co., Ltd.

Disaster Prevention and Mitigation to Counter Increase in Landslide

Disasters due to Climate Change in Thailand, and Application to

Countries in the Greater Mekong Subregion

PEAR Carbon Offset Initiative,

Ltd.

Organic Waste Composting in the Maldives

from far east Inc. The Forest Wisdom Project

euglena Co., Ltd. Feasibility Study of High-Quality Mung Bean Cultivation in

High-Salinity Areas of Bangladesh

1-2. Summaries of studies of projects selected

Taking each participant (lead enterprise) in turn, the projects selected are profiled below from the

following seven angles: (1) purpose of study, (2) threats faced by host country due to climate change, (3)

proposed solution to threats, (4) elements of study, (5) expected policy effects, (6) methodological approach

to project appraisal, and (7) outline of technologies/products used or proposer’s strengths. To ensure that

the participants followed a common framework of metrics for their projects, they were required to provide

metrics tailored to their respective projects for each of the following three stages: inputs, outputs, and

outcomes. Unlike “mitigation” action, “adaptation” action is particular and localized in its policy effects,

and so cannot be measured employing a uniform framework. To provide a common framework for the

adaptation FSs, therefore, projects were assessed by measuring how implementation of each adaptation

measure affected the target population (outputs), and how these outputs contributed to attaining the goals

laid down by overarching development strategies, such as developing countries own National Adaptation

Programmes of Action (NAPAs) and the Millennium Development Goals (MDGs).1

1 The Millennium Development Goals (MDGs) were established following the Millennium Summit of the United Nations

held in New York in September 2000, and were adopted by the 189 member states of the UN as goals to be met by the

international community in the 21st century. Eight goals are set for attainment by 2015 in a number of areas, including

peace and security, development and poverty, the environment, and human rights and good governance.

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1) Kaiho Recycled Farm Equipment Rental Business (Kaiho Sangyo Co., Ltd.)

(1) Purpose of study

This study aims to reduce food shortages and decline in economic strength in Ghana caused by climate

change through the renting out of agricultural machinery to increase food self-sufficiency.

(2) Threats faced by host country (Ghana) due to climate change

• Ghana is vulnerable to four main threats: (a) temperature rise, (b) decrease and variation in rainfall

patterns, (c) sea level rise, and (d) abnormal weather and natural disasters.

• Ghana’s economy is dependent on agriculture, water, natural resources, and energy, which are

vulnerable to climate change. The effect on agriculture is of particular concern because it accounts

for 30% of total GDP in Ghana.

(3) Proposed solution to threats

• MOFA-led agricultural automation has been pursued in Ghana, but progress has been

unsatisfactory.

• The program has revealed a critical local need in the agricultural sector to secure water resources

due to the effects of climate change.

• Providing mobile pump cars based on used Japanese “Kei truck” mini trucks is proposed as a

solution to the above threats.

(4) Elements of study

• Market research, provision of agricultural know-how and used agricultural machinery and spare

parts

• Provision of Thai-made used agricultural machinery and spare parts

• Import of used agricultural machinery and spare parts, installation of equipment onsite,

development of connections with MOFA

• Investigation of current market situation for custom work

(5) Expected policy effects

• Improvement of living standard and resolution of food problem faced by agricultural workers as a

result of solving vulnerability to drought

• Expansion of available agricultural land

• Growth in volume of crop production

• Lengthening of harvest period

• Improvement of income level

(6) Methodological approach to project appraisal

The following method is used to evaluate this project (Figure 2).

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Figure 2 Methodology for project appraisal (Kaiho Sangyo)

Input Output Outcome

Performance

index

1: Introduction of

mobile pump car

2: Training for

agricultural

employees.

1: Growth in volume of crop production Improvement of living

standard and resolution of

food problem faced by

agricultural workers as a

result of solving

vulnerability to drought

2: Expansion of available agricultural land

3: Lengthening of harvest period

4: Improvement of income level

(7) Outline of technologies/products used or proposer’s strengths

• The mobile pump car used for the project is designed based on a Japanese Kei car, and it carries a

water pump that enables it to supply water over a wide range of terrains. It is driven by a 660 cc

petrol engine, which supplies power to a water pump, hose, and water tank.

• Kei cars are widely used in Japan, as well as by farmers in the US. This compact 4WD truck

provides stable performance even on rough roads.

• This car carries a mobilize water pump, allowing water to be supplied in a wide range of

agricultural fields.

• The water tank is removable and the car can be used for transportation of farm produce.

Figure 3 Mobile pump car (proposed)

Source: LK International.

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2) Disaster Prevention and Mitigation to Counter Increase in Landslide Disasters due

to Climate Change in Thailand, and Application to Countries in the Greater Mekong

Subregion (Kawasaki Geological Engineering Co., Ltd.)


This study aims to establish a business model for taking the disaster prevention and mitigation

technologies that were proven to be effective by a feasibility study carried out in Vietnam in 2013 and

rolling them out to the Greater Mekong Subregion (GMS), especially to Thailand, where disaster awareness

and knowledge of disaster prevention and mitigation are the highest in the region.

(2) Threats faced by host country (Thailand) due to climate change

• Natural disasters caused by rainfall have been occurring with increasing frequency due to the

effects of climate change, and the countries comprising the GMS are particularly vulnerable due to

their tropical climate.

• The floods that occurred in Thailand in 2011 severely affected both the Japanese and the world

economies due to the disruption that they caused to supply chains.


• A field survey should be performed, evacuation warning system installed, and construction of

countermeasures planned and designed further to identification, analysis, and evaluation of areas at

high risk of disasters using satellite images.

• Awareness of disaster prevention and mitigation should be raised and disaster prevention and

mitigation mechanisms firmly established through engagement in business involving the

development, manufacture, and distribution of hardware and software for early disaster warning

systems, and the provision and licensing of relate technologies to local firms.


• Field survey of early disaster warning system

• Survey and analysis of issues and needs concerning early disaster warning systems

• Clarification of system requirements

• Consideration and determination of course of system development

• Survey of external requirements for actual use of the system

• Discussion among parties concerned and drawing up of business plan


• Local economic activity should be promoted by reducing economic loss caused by destruction,

restructuring, and shifting of infrastructure, and by reducing accidents before, after, and during

infrastructure construction.

• Packaging slope disaster prevention and mitigation technologies together should contribute to

development and establishment of a disaster resilient economic corridor and facilitate the

business activities of local and Japanese enterprises.

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Figure 4 Methodology for project appraisal (Kawasaki Geological Engineering)

Inputs Outputs Lower outcomes Higher outcomes


• KGE has broad experience of post-disaster construction and damage repair after earthquakes,

including the Mid Niigata prefecture Earthquake in 2004, the Niigata Chuetsu Earthquake in 2007,

and the Great East Japan Earthquake in 2011.

• Following the Great East Japan Earthquake on March 11, 2011, KGE led disaster-related

emergency anti-erosion work in Tochigi prefecture and was involved in surveying, field

measurement, countermeasure work, and construction control.

• KGE has a backup system maintained by its Hanoi office established in FY 2014.

Areas with dangerous geography

identified by image analysis

Areas with dangerous geography

identified by laser

Installment of disaster warning

system

Number of slope protection works

in risk-assessed areas

Development of guidelines on slope

protection works in GMS

Determination of hazardous slopes

Numbers of hazard maps provided

Areas covered by disaster warning

system

Number of residents covered by

disaster warning system

Total road length protected by

slope protection works

Number of works built in GMS

following slope protection work

guidelines

Number of residents living in

risk-assessed areas

Number of slope protection works

in risk-assessed areas

Number of residents moved from

risk-assessed hazardous areas

Number of people evacuated by

disaster warning system

Number of service interruptions

caused by landslide disasters on

roads

Number of works built based on

slope protection work guidelines

Number of disaster fatalities

Economic loss by disasters

Number of disaster victims

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3) Organic Waste Composting in the Maldives (PEAR Carbon Offset Initiative, Ltd.)


The Republic of Maldives is one of the island nations that is vulnerable to climate change. This study

therefore proposes to counter climate change-induced sea level rise by using Japan composting technology

to compost organic household waste generated in the city of Male to reduce the volume produced and

prevent ocean pollution, and at the same time to protect the Maldives from submersion by using the

compost to reclaim land by building embankments.

(2) Threats faced by host country (Maldives) due to climate change

• Coral reefs around the Maldives are suffering from bleaching due to sea temperature rise and

ocean acidification, causing them to lose their functions as an island bedrock and natural

breakwater. Consequently, more than 80% of inhabited islands are subject to erosion throughout

the year.

• The landform of the Maldives is flat, 1.5 m above sea level on average and 2.4 m at the highest

point. If sea level rises 1 m, 80% of the islands are expected to be submerged.


• Waste is reduced and ocean pollution is prevented by composting organic waste generated by

households in Male. The compost produced as a result is also used for tree planting to make up for

the present lack of embankments built to raise the ground level as a measure against high tides and

sea level rise.


• Research on effects of climate change

• Research on current status and problems with household waste treatment

• Research on composting technology

• Design of composting plant

• Research on economic evaluation

• Research on risk evaluation and environmental integrity

• Research on EIA, approval and licenses

• Research on PPP project

• Research on potential for wider use

• Creation of methodology for evaluating performance after installation of technology and products,

and evaluation thereof


• At present, embankments are made of dredged sea sand and compost for tree planting is imported.

Producing compost from organic waste can reduce the amount of imported compost and protect the

islands from submersion and high tides, thus contributing to saving the lives and properties of

residents.

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• The waste treatment process used at present results in CH4 emissions into the air due to anaerobic

fermentation of organic waste. This project limits such emissions by instead employing aerobic

fermentation, and is thus in line with the carbon neutral policy of the Maldivian government.



Figure 5 Methodology for project appraisal (PEAR Carbon Offset Initiative)

Goal Sustainable development of tourism and fisheries by composting organic waste in the Maldives

Outcome Contribution to solution

of social problems

Contribution to solution of marine ecosystem

problems

Contribution to solution of environmental

problems

Contribution to public health improvement

Contribution to mitigation of global

warming

Middle outcome

Increase in employment rate and income of BOP

Reduction of coral reef bleaching

Increase in other marine creatures

Reduction of pollutants in organic waste flowing

into ocean

Reduction of flies, mosquitoes, and

malodors

Reduced emission of CH4 due to anaerobic

fermentation of organic waste

Output Increase in workers

engaged in production and sale of compost

Reduction of amount of organic waste landfill




Input Production of compost by aerobic fermentation treatment of organic waste


• The project envisages construction of a composting plant consisting of two RA-X screw-type

automatic stirring machines (a patented technology (Patent No. JP3607252) made by Kawashima

Co, Ltd.) and two fermenters, giving the plant a compost production capacity of 10 tons/day

(Figures 6 and 7).

• Organic waste is first carried in scattering buckets to the fermenters and an effective

microorganism (BX-1) is simultaneously scattered on by hand. The organic waste is then stirred by

the RA-Xs and finally converted to compost in the fermenters by aerobic fermentation.

• The addition of a certain amount of BX-1 to the organic waste makes it possible to prevent

malodors and easily control aerobic fermentation at high temperature.

Figure 6 Fermenter and RA-X

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Figure 7 RA-X automatic screw agitator

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4) The Forest Wisdom Project (from far east inc.)


The objective of this project is to vertically integrate the production and processing in Cambodia, as well

as sale in Japan, of additive-free hair dyes and soaps. It aims thereby to increase agricultural productivity,

improve farmland and forest, and increase the number of product users by lowering the cost of procurement

of the ingredients used to make these products.

(2) Threats faced by host country (Cambodia) due to climate change

• In Cambodia, the frequency of flooding and droughts is increasing. According to “Climate Change

Impacts and Vulnerability,” floods and droughts are a health hazard and cause agricultural

productivity to decline due to lack of agricultural water. This project focuses on tackling the

decline in agricultural productivity.


• A consortium lead by from far east inc. will provide training for farmers in Cambodia in how to

cultivate organic plant materials. Seeds, fertilizers, and soil conditioners will also be provided.

• Growing more trees whose fruit and leaves can be used as organic ingredients should reduce flood

damage.

• The project’s sustainability will be enhanced by having the consortium buy the organic ingredients

grown to make and sell hair dyes and soaps on the Japanese and Cambodian markets.


• Field survey of climate change in Cambodia

• Feasibility study of improvement of agricultural productivity in Cambodia

• Survey of procedures for exporting agricultural products to Japan

• Test manufacturing using agricultural products

• Consideration of sales techniques and business plan


• Expansion of cultivated land capable of sustainable farming

• Increase of crop yields per unit area by using a soil conditioner

• Decrease of flood damage by tree planting

• Stable purchase of crops for manufacturing hair dyes and soaps for the Japanese and local markets



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Figure 8 Methodology for project appraisal (from far east)


Performance

index

Number of trained farmers Amounts of crops Farmers’ income

Land with soil conditioner Amounts of yields per area Forest area with sustainable

farming

Forest area with soil conditioner Forest area Forest area with agro forestry


• This project uses organic soil conditioner manufactured from oyster shells and charcoal (Figure 9).

• This soil conditioner works by restoring soil damaged by pesticides and chemical fertilizers so as

to raise the vitality of plants.

Figure 9 Soil conditioner used for the project

• Personal care products such as shampoos are made solely from natural ingredients and without

using any chemical additives, making them both environmentally and health friendly (Figure 10).

• These products are made from ingredients harvested from moringa, coconut, almond, and other

trees planted for the project.

Figure 10 Products produced by the project

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5) Feasibility Study of High-Quality Mung Bean Cultivation in High-Salinity Areas of

Bangladesh (euglena Co., Ltd.)


When surveyed in 2013, increased salinity due to lower rainfall was observed to result not only in lower

yields but also more abnormal (wrinkled and discolored) beans. The aim this year is to revise the

desalination work manual in order to improve quality. A feasibility study of mung bean cultivation in

high-salinity areas will then be conducted.

(2) Threats faced by host country (Bangladesh) due to climate change

• Average elevation in Bangladesh is as low as 9 m. According to the UN Intergovernmental Panel

on Climate Change, approximately 17% of Bangladesh will be submerged under water, and crop

production will fall approximately 30% compared with current levels by 2050.

• The area of land affected by salinity in southern coastal areas rose from 833,000 ha in 1973 to

1,056,000 ha in 2009 (an increase of 26.7% in roughly 35 years).


• Measures are required to mitigate the increase in salinity identified as a problem last year. In

addition to “plowing” and “fertilization with calcium sulfate” as up to last year, tests will be made

of the best combination of “irrigation” and “flooding and plowing.”

• Improvements in yields and quality improvement through verification of the “effect of rotational

cropping” are expected. These should lead to improvements in the cropping ratio and amounts

harvested in high-salinity areas.


• Introduction of new cultivation guidelines on salinity

• Continuous development of saline tolerant variety

• Improvement of production quality under conditions of mass cultivation

• Continuous survey of the effects of rotational cropping

• Survey of potential of other farm products


• The project is expected to help improve local food security and continuity of supply of mung beans

to Japan by supplying 50% of good quality produce to the local market and exporting the

remaining 50% to Japan.

• It should also contribute to creating job opportunities in farming, threshing, and sorting operations

for local people.

• By verifying the effects of rotational cropping in mung bean cultivation (leading to soil

improvement though nitrogen fixing and consequently increased yields), it may be possible to roll

the method out to other areas suffering similar problems, such as replant failure due to climate

change and continued single-crop cultivation.

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Figure 11 Methodology for project appraisal (euglena)


Improvement of production quality under mass cultivation conditions

Increase of yields in high-salinity areas

Improvement of production level of crops in high-salinity areas

Continuous development of saline tolerant variety

Improvement of mung bean germination ratio in high-salinity areas

Increase in yields in high-salinity

areas

Continuous survey of effects of rotational cropping

Improvement of yields of rice grown as a succeeding crop

Rise in food self-sufficiency and avoidance of replant failures

Survey of potential of other farm products

Increase in choice of cropping patterns

Rise in food self-sufficiency and avoidance of replant failures


• The project began in 2012 and has produced a combined total of three years’ worth of results.

• It has resulted in establishment of mung bean cultivation and training systems in the local area, and

accumulation of associated know-how.

• Issues and responses to them have already been identified through the feasibility study of mung

bean cultivation in high-salinity areas over the last two years, and field trials of these responses can

now be conducted.

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2. Identification and consideration of policy concerns

2-1. Consideration by Adaptation Advisory Panel of feasibility study performance

To make the feasibility studies more effective, an “Adaptation Advisory Panel” of outside experts was

formed to provide expert advice tailored to the adaptation FS performers’ specific circumstances and to

identify the policy concerns to address. The panel consisted of academics and experts at development

agencies, financial institutions, and other organizations (Figure 12).

The panel’s members met to discuss and provide their respective insights on ways forward in policy in

light of the evolution of adaptation-related initiatives at their own organizations and counterparts in other

countries. Working on the basis of each member’s knowledge and experience, the panel then provided

advice and suggestions designed to enhance the performance and results of each study.

Figure 12 Agendas of METI Adaptation Advisory Panel meetings

Agenda

First meeting

(Nov. 21)

Explanation of purpose and role of panel

Introduction of reports for past fiscal year

Introduction of projects selected for FY 2014 “Program of Feasibility Studies to

Visualize the Contributions of Japanese Firms to Adaptation Measures in

Developing Countries”

Second meeting

(Dec. 19)

Presentation of interim reports by feasibility study performers

Kawasaki Geological Engineering

PEAR Carbon Offset Initiative

euglena

Third meeting

(December 19)

Presentation of interim reports by feasibility study performers

Kaiho Sangyo

from far east

Fourth meeting

(February 23)

Presentation of final reports by feasibility study performers

Kawasaki Geological

PEAR Carbon Offset Initiative

euglena

from far east

Kaiho Sangyo

2-2. Identification of policy concerns

1) Policy concerns regarding action by Japanese firms in the field of adaptation

Through its discussions, METI’s Adaptation Advisory Panel identified three important concerns and

responses to them in order to encourage Japanese firms to develop a greater presence in the field of

adaptation in developing countries. These were: (1) popularization of the concept of adaptation business in

Japan, (2) cultivation of awareness of adaptation business among Japanese enterprises, and (3) development

of a platform for collaboration with host governments on projects selected for feasibility studies (Figure

13).

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Table 13 Policy concerns and responses identified by the Adaptation Advisory Panel

(1) Popularization of concept of adaptation business in Japan

The Adaptation Advisory Panel drew attention to the need for wider knowledge of the concept of

“adaptation.” As adaptation is a relatively new concept, awareness of it is still low amongst both the general

public and businesses. This applies to adaptation FSs, too, presentations and symposiums on which have

only been held in Tokyo to date. However, the Program of Support for Development of Operations

Overseas by Smaller Businesses Using ODA run by the Ministry of Foreign Affairs and JICA has

demonstrated that the existence beyond Japan’s main urban centers of large numbers of firms with the

technologies to help address the issues faced by developing countries is one area in which Japan excels

compared with other countries. Action is therefore needed to raise knowledge (including in major cities in

the regions) of the concept of adaptation business and adaptation FSs. The panel’s members also advised

that such knowledge-raising activities should be organized in cooperation with Japanese government

agencies’ existing regional centers in order to ensure greater efficiency. It will thus likely become necessary

to develop arrangements for raising knowledge of adaptation business in the future.

(2) Cultivation of awareness of adaptation business among Japanese firms

Also raised as an issue was the need to cultivate awareness among Japanese firms of adaptation business.

Adaptation business is a new concept and still lacks a globally accepted definition. Consequently few

Japanese firms are currently involved in adaptation business, and interest in engaging in such business is

low in the Japanese business community. Redefining adaptation business offers one way of helping firms to

understand how it relates to their own particular business concerns and circumstances.

Adaptation FSs have to date defined adaptation business as “the contribution through action on a

business footing in the field of adaptation to manage the effects of climate change by applying the

outstanding technologies and other resources of Japanese firms in countries that are particularly vulnerable

to climate change,” and support has mainly been targeted at the creation of new business. Meanwhile, as

business activities have grown more globalized, firms have found themselves increasingly affected by

climate change, leading more and more of them to pursue their own adaptation strategies. Thus while

emphasis is still placed on addressing the priorities targeted by host countries’ NAPAs, it may be more

Policy concern Response Response details

Popularization of concept of

adaptation business in Japan

Broadening of action to

raise knowledge of

adaptation business

Pursuit of activities to raise knowledge in major

regional cities as well as Tokyo in partnership

with Japanese government agencies’ existing

regional centers

Cultivation of awareness of

adaptation business among

Japanese firms

Redefinition of adaptation

business

Redefinition of adaptation business to give

Japanese firms a better understanding of how it

relates to their own management concerns and

situations

Development of platform for

collaboration with host

governments on projects

selected for feasibility

studies

Strengthening of relations

between projects selected

for feasibility studies and

adaptation challenges

Clarification of relations between projects

selected for feasibility studies and individual

countries’ NAPAs, and enhancement of

coordination with host governments’ existing

activities

17

effective in practice to also include action to improve existing business operations within the scope of

adaptation business provided that such action contributes to addressing these priorities. In order to thus

enhance the effectiveness of adaptation measures implemented through business activities, adaptation

business therefore needs to be redefined so as to raise awareness of it among Japanese firms and increase

the intersections between firms and adaptation business.

(3) Development of platform for collaboration with host governments on projects selected

for feasibility studies

In order to enhance the adaptation effects generated by projects selected for feasibility studies,

coordination with host governments is essential. Opportunities for coordination with host governments’

existing activities therefore need to be increased.

It was also noted by the Adaptation Advisory Panel that the breadth of the concept of adaptation can

make it difficult to judge whether the issues that the projects selected for feasibility studies propose to solve

are due to the effects of climate change, or whether they are instead social or developmental issues. While

one of the criteria by which adaptation FSs were considered was whether or not it had been suggested by

international or host government agencies that the issues that they sought to address were adaptation issues,

interpretations nevertheless differed depending on the views of individual panel members.

In order to develop a platform for coordinating the projects selected for feasibility studies with host

governments’ activities in the future, therefore, the objects selected for feasibility studies need to be tied

more closely to host governments’ priorities (as identified by their NAPAs) and their existing actions on

them. One specific means of achieving this would be to make it a requirement when adaptation FS

proposals are sought that proposers recommend a host country for their projects based on the Japanese

government’s policy objectives, level of vulnerability, and existence of an NAPA, and to indicate the

priority concerns identified by that country’s NAPA, so as to ensure that only projects that address those

concerns are selected. Depending on the state of progress on projects selected for feasibility studies, it is

also likely to be necessary to make the development of a platform for coordination with the host country

and creation of opportunities for cooperation with related host country organizations a necessary element of

feasibility study projects.

2) Global developments and Japanese government policy regarding adaptation

(1) Global developments regarding adaptation

Of the various global developments in the field of adaptation that have occurred this fiscal year, three in

particular have a bearing on this program. These are: (1) the publication of the Fifth Assessment Report

(AR5) of the Intergovernmental Panel on Climate Change (IPCC), (2) the 20th session of the Conference of

the Parties to the United Nations Framework Convention on Climate Change (COP20), and (3) the release

of the Adaptation Gap Report by the United Nations Environment Programme (UNEP).

Regarding firstly AR5, this reiterated the need to pursue both adaptation measures and mitigation

measures. It covered measures that had not been described in AR4, provided assessments of the changes in

climate change risks that could be expected depending on whether or not adaptation measures were taken,

and estimated the cost of adaptation to the effects of climate change in developing countries in 2050.

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Regarding secondly COP20, this was intended to produce a list of draft commitments from each country

under the framework from 2020. While developed countries focused on action to mitigate global warming,

developing countries argued for the adoption of adaptation as well as mitigation options, and also

advocated the inclusion of commitments to financial assistance. Ultimately, however, the session concluded

with all countries proposing draft commitments that focused on mitigation. But despite the focus on

mitigation, it was also decided to promote national adaptation initiatives. This was evident in, for example,

the decision to consider also the submission of initiatives for adaptation plans or inclusion in draft

commitments of the elements of adaptation, and in the encouragement of UNFCCC parties to recommend

experts with diverse knowledge and experience of adaptation to climate change to the Adaptation Advisory

Panel.

Regarding thirdly publication of the UNEP Adaptation Gap Report, this restated that the damage suffered

by vulnerable developing countries in particular will worsen, and suggested that there was a risk that

adaptation could cost anywhere between US$250 billion and US$500 billion a year by 2050, which is at

least two to three times greater than the annual cost of US$70 billion to US$100 billion that the IPCC

forecast would be required by 2050 in November. Observing the need for developed countries to help

finance adaptation in developing countries, the report also stated that total funding of adaptation in 2012-13

came to US$23-26 billion and called for fresh or additional financing.

While the focus of government policies on climate change around the word is currently on mitigation,

the evidence points to a rapidly growing need for action on adaptation.

(2) Developments involving the Japanese government

With these global developments as a backdrop, the Japanese government is pursuing positive action in

the field of adaptation. This year, Prime Minister Shinzo Abe announced the launch of a program of

adaptation initiatives at the UN Climate Change Summit in September. These initiatives consist of six

elements, namely: assistance with the development of adaptation plans (strategy-making and planning),

assistance with the implementation of adaptation measures, assistance with overcoming vulnerabilities

particular to small island developing states (SIDS), assistance with disaster risk reduction, utilization of

Japanese technologies in the field of adaptation, and human resource development.

At COP20 in December, a number of actual adaptation initiatives were announced, providing concrete

evidence of the Japanese government’s stance on adaptation (Figure 14).

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Figure 14 Overview of adaptation initiatives being pursued by Japan

Category Project

Assistance with adaptation planning

Case (1): Project to Build Capacity to Tackle Climate Change

(Indonesia)

Case (2): Support for Adaptation Policymaking Contributing to

Stable Food Production (Southeast Asia)

Case (3): Support for Adaptation Planning in Developing Countries –

Future Action

Assistance with implementation of

adaptation measures

Case (1): Project to Improve Water Supply, Sanitation, and

Livelihoods through Diffusion of Rope Pumps for Drinking Water

(Ethiopia)

Case (2): Project to Enhance Groundwater and Seawater Intrusion

Management Capacity (Cuba)

Case (3): Project to Develop Drought Tolerant Trees for Adaptation

to Climate Change (Kenya)

Assistance with

overcoming

vulnerabilities

particular to

SIDS

CARICOM

countries

Case (1): Project for Japan-Caribbean Climate Change Partnership

(UNDP Partnership)

Case (2): Technology Cooperation to Enhance Disaster Risk

Reduction Capacity

Pacific region

Case (1): Water Resources and Water Supply Services for Pacific

Island Countries

Case (2): Project to Reinforce the Meteorological Training Functions

of Fiji Meteorological Service (Fiji)

Assistance with disaster risk

reduction

Case (1): Standby Emergency Credit for Urgent Recovery

(Philippines, Peru)

Case (2): Project on Rehabilitation and Recovery from Typhoon

Yolanda (Philippines)

Case (3): Project to Build Disaster Resilient Communities (Phase 2)

(Vietnam)

Utilization of Japanese technologies

in the field of adaptation

Case (1): Provision of Data Projecting Climate Change

Case (2): Utilization of Earth Observation Technologies

Case (3): Development of a Wet-Rice Cultivation System Adapted to

Climate Change

Case (4): Disaster Management Collaboration Dialogue

Human resource development

Case (1): Training and Education to Strengthen Capacity to Adapt to

Climate Change

Case (2): Analysis and Mapping of Impacts Under Climate Change

for Adaptation and Food Security through South-South Cooperation

(AMICAF)

Case (3): Practical Guidelines on Strategic Climate Change

Adaptation Planning – Flood Disasters

Source: Government of Japan, “Japan’s Adaptation Initiatives: Concrete Examples.”

Japan is thus leading the international community in beginning to highlight concrete action on adaptation,

and the results of the adaptation FSs pursued under the present program will also need to be highlighted in

line with this trend.

20

3. Raising the international and domestic profile of Japanese initiatives

Advantage was taken of two events to raise knowledge and awareness, both domestically and

internationally, of the importance of adaptation projects undertaken by the private sector and the results of

schemes to assist adaptation measures organized by the Ministry of Economy, Trade and Industry (METI).

These were as follows: to reach an international audience, examples of adaptation FSs were presented at the

21st National Convention of the Japanese Academy of International Business Studies; and to reach a

Japanese audience, presentations were made at symposium hosted by METI entitled “The Contribution of

Japanese Technologies to Adaptation to Climate Change in Asia, Africa, and Island States: Responding to

Developing Country’s Needs and the Evolution of Global Business.”

3-1. 21st National Convention of the Japanese Academy of International Business

Studies

The 21st National Convention of the Japanese Academy of International Business Studies held in

Hokkaido on November 2-3, 2014, was used as an opportunity to present examples of the activities being

undertaken under this program. The convention was attended by international invitees including Paul Y. J.

Kim, President of the Korean Academy of International Business, making this a valuable occasion for

sharing information on the program with an international audience.

The program was introduced as part of the third session, when research reports were presented, on

November 2. Two projects selected for feasibility studies were reported on: those involving, respectively,

Kaiho Sangyo and from far east.

3-2. METI symposium on “The Contribution of Japanese Technologies to Adaptation to

Climate Change in Asia, Africa, and Island States: Responding to Developing

Country’s Needs and the Evolution of Global Business

At this METI-hosted symposium in March 2015, presentations were given concerning the activities of

two of Japan’s leaders in the field of adaptation, Sompo Japan Nipponkoa Insurance and NEC. Information

on the state of support provided by METI for feasibility studies of adaptation projects was shared, shedding

light on the role of Japanese firms involved in adaptation and the potential for new business in emerging

and developing countries (Figure 15).

21

Figure 15 Details of “Climate Change Adaptation Business as a Means of Developing Markets in Africa”

Opening Address

Toshiaki Nagata

Deputy Director, METI Global Environmental Partnership and

Technologies Office

Presentation (1)

“Outline of Feasibility Study

Support for Selected Projects

Undertaken by Japanese

Enterprises in FY 2014 and

Future Spread in the Climate

Change Adaptation Business”

Tokutaro Hiramoto

Senior Consultant, Nomura Research Institute

Presentation (2)

“Action by Pioneering Japanese

Firms and Approaches to

Adaptation”

Masao Seki

Senior Advisor on CSR, Sompo Japan Nipponkoa Insurance

Tsuyoshi Horinouchi

Acting Manager, Quality Promotion Division & Director of

Environmental Management, NEC

Panel Discussion

“The Role of Private Enterprise

and New Business

Opportunities in Climate

Change Adaptation”

Panelists:

Toshiaki Nagata

Deputy Director, METI Global Environmental Partnership and

Technologies Office

Masao Seki

Senior Advisor on CSR, Sompo Japan Nipponkoa Insurance

Tsuyoshi Horinouchi

Acting Director of Quality Promotion & Director of

Environmental Management, NEC

Coordinator:

Tokutaro Hiramoto

Senior Consultant, Nomura Research Institute

22

4. Roundup of results

4-1. Ongoing sharing of information on results to date

This year marks the third year of adaptation FSs, which commenced in FY 2012. An analysis was

therefore performed to determine the extent to which activities undertaken under the program to date have

served to raise awareness of adaptation business in Japan.

Regarding adaptation business, information has been continuously shared on the results of adaptation

FSs since their commencement in FY 2012. This year, information has been actively shared via the press

and other channels, one example being an article on “Climate Change Adaptation Measures in Africa”

(emerging nation ABC), which appeared in Nikkei Sangyo Shinbun on December 8, 2014. As a result of

such ongoing information sharing, awareness of adaptation business has risen since adaptation FSs

commenced in FY 2012.

Firstly, an AND search for the terms “adaptation” and “climate change” in newspaper articles searchable

in the Nikkei Telecom database2 revealed a sharp rise in the number of articles containing these terms in

FY 2013, and the number has continued to grow this year too. The increase in 2013 was probably at least

partly a reflection of Japanese government policy on adaptation beginning to go into effect, as evidenced by

the government’s channeling of approximately US$2.3 billion of financial support into action on adaptation

to climate change in developing countries between January 2013 and June 2014, and the release by the

Ministry of Education, Culture, Sports, Science and Technology, the Japan Meteorological Agency, and the

Ministry of the Environment of a report detailing observations and forecasts of climate change, and an

assessment of its effects, entitled “Climate Change in Japan and Its Effects (2012).”

With interest in adaptation as a whole increasing in Japan and also overseas, interest in adaptation

business in developing countries is also steadily rising. Performing an AND search for four

terms—“climate change,” “adaptation,” “business,” and “developing countries”—in the Nikkei Telecom

database to analyze changes in the number of newspaper articles on adaptation business, we find that the

number of articles per year has risen continuously since FY 2011. Also apparent is that the proportion of all

adaptation-related articles that concern adaptation business is also rising, albeit gradually (Figure 16).

While awareness of adaptation business is thus on the rise, awareness is still insufficient, as noted in II.

Identification and consideration of policy concerns, and a public information strategy is required to

further raise awareness.

2 As of January 24, 2014, searches could be made of 148 newspapers in the Nikkei Telecom database (12 Nikkei

newspapers, 6 national newspapers, 45 general newspapers, 80 trade journals, and 5 sports papers).

23

Figure 16 Changes in number of newspaper articles on “adaptation business”

Source: Compiled by NRI from searches of Nikkei Telecom articles.

4-2. Where next for adaptation policy?

The focus next is on those firms that have actually implemented projects and generated adaptation effects

in their host countries as a result of their adaptation FSs. Some of the firms that conducted adaptation FSs,

such as euglena, which was one of the participants this year, are on the verge of project implementation and

have already reached the stage of generating adaptation effects in their host countries.

Nevertheless, these projects and the impact of their adaptation effects are still small in scale, and they do

not presently provide a sufficient demonstration to host governments of the contributions that the Japanese

government and Japanese firms can make. In addition to the issues described in II. Identification and

consideration of policy concerns, therefore, it is likely to be necessary to take action in three further areas:

(1) scaling up of the adaptation effects generated by successful projects, (2) highlighting of the

contributions made by the Japanese government and Japanese firms to host governments, and (3)

development of arrangements to continuously generate successful projects.

(1) Scaling up of adaptation effects generated by successful projects

The beneficiaries of the adaptation effects so far actually generated in developing countries by adaptation

FSs number only in the tens of thousands. Set against this, the populations adversely affected by climate

change per country range in size from several thousand to several million, depending on the type of climate

change concerned. This means that, at the very least, the number of beneficiaries of each project will have

to be scaled up to several hundred to several thousand. To achieve this, it will be necessary to work in

partnership with host governments and to target support at Japanese firms that have generated adaptation

effects through adaptation business already so as to help scale up their effects.

1.9%

3.7% 3.5%

4.1%

5 8 21 30

257 21

7

604

723

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

0

100

20

0

300

400

500

600

70

0

800

2011

2012

2013

2014

% of all adaptation-related articles

that concern adaptation business

Number of search results for “climate

change AND adaptation AND

business AND developing countries”

Number of search results for

“adaptation AND climate change”

24

(2) Highlighting of the contributions of the Japanese government and Japanese firms to

host governments

The Japanese government has made support for other countries’ adaptation planning a key strategy of

adaptation initiatives. But while some developing countries have already prepared NAPAs, sufficient

progress is being made on action and studies in only a few of the priority fields identified by them. As well

as just seeking to increase the number of successful projects resulting from adaptation FSs as part of such a

strategy, therefore, these projects should also be seen as a springboard to the development of concrete

projects by host governments. Shedding light on the actual state of climate change through implementation

of adaptation measures should also translate into the development of more detailed and concrete adaptation

plans. At present, such contributions by the Japanese government and Japanese firms are not being

sufficiently demonstrated to host governments, and one of the reasons for this may be that insufficient

cooperation from host governments—a requirement for (1) Scaling up of adaptation effects generated by

successful projects—has so far been obtained. This points to a need to create vehicles to highlight to host

governments the results of successful projects that have proceeded beyond the feasibility study stage to

produce actual adaptation effects. There is, moreover, a need when helping to scale up the adaptation

effects observed in adaptation FSs to include in such studies negotiations toward the launch of initiatives in

partnership with host governments, the development of arrangements to enable the continuity of activities

in the host region, and coordination with existing related activities in the host region. Systematizing and

sharing with host regions the experience and information accumulated by Japanese firms in the course of

their adaptation business through such means should not only make host governments more aware of the

results of adaptation FSs, but also create the conditions for these governments to themselves showcase their

adaptation success stories to the rest of the world.

(3) Development of arrangements to continuously generate successful projects

As noted above, some of the firms that conducted adaptation FSs, such as euglena, which was one of the

participants this year, are on the verge of project implementation and have already reached the stage of

generating adaptation effects in their host countries. However, the number of such successful projects is

still low, and a succession of two or three such successful projects is required. It is therefore necessary to

expand the number of (1) firms that are interested in adaptation business, (2) firms that are exploring the

possibilities of adaptation business, and (3) firms that are verifying the feasibility of adaptation business. To

achieve this, it will be necessary to explore support mechanisms that allow support to be delivered in a

phased manner.

fy 2014 program to reduce global warming emissions

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