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
3
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.
4
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).
5
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.
6
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.)
(1) Purpose of study
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.
(3) Proposed solution to threats
• 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.
(4) Elements of study
• 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
(5) Expected policy effects
• 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.
7
(6) Methodological approach to project appraisal
The following method is used to evaluate this project (Figure 4).
Figure 4 Methodology for project appraisal (Kawasaki Geological Engineering)
Inputs Outputs Lower outcomes Higher outcomes
(7) Outline of technologies/products used or proposer’s strengths
• 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
8
3) Organic Waste Composting in the Maldives (PEAR Carbon Offset Initiative, Ltd.)
(1) Purpose of study
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.
(3) Proposed solution to threats
• 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.
(4) Elements of study
• 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
(5) Expected policy effects
• 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.
9
• 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.
(6) Methodological approach to project appraisal
The following method is used to evaluate this project (Figure 5).
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
Reduction of amount of organic waste landfill
Reduction of amount of organic waste landfill
Reduction of amount of organic waste landfill
Input Production of compost by aerobic fermentation treatment of organic waste
(7) Outline of technologies/products used or proposer’s strengths
• 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
11
4) The Forest Wisdom Project (from far east inc.)
(1) Purpose of study
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.
(3) Proposed solution to threats
• 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.
(4) Elements of study
• 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
(5) Expected policy effects
• 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
(6) Methodological approach to project appraisal
The following method is used to evaluate this project (Figure 8).
12
Figure 8 Methodology for project appraisal (from far east)
Input Output Outcome
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
(7) Outline of technologies/products used or proposer’s strengths
• 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
13
5) Feasibility Study of High-Quality Mung Bean Cultivation in High-Salinity Areas of
Bangladesh (euglena Co., Ltd.)
(1) Purpose of study
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).
(3) Proposed solution to threats
• 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.
(4) Elements of study
• 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
(5) Expected policy effects
• 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.
14
(6) Methodological approach to project appraisal
The following method is used to evaluate this project (Figure 11).
Figure 11 Methodology for project appraisal (euglena)
Input Output Outcome
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
(7) Outline of technologies/products used or proposer’s strengths
• 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.
15
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).
16
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.
18
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).
19
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.