A just transition requires a major paradigm shift

A just transition requires a major paradigm shift

Covid-19 is a disease that not only attacks individuals but Thai society. Millions of workers who make subsistence wages or already face household debt now have no income. Thailand is seeing -- like much of the world -- people sliding back into extreme poverty and deeper social inequality. Mental health is deteriorating as a result. Help does not seem at hand for people, who are feeling abandoned by a lack of clear government assistance.

Homeowners can become 'prosumers' in a decentralised energy market by generating electricity from solar-roof panels for their own consumption and selling any surplus to a national grid. Courtesy of Gunkul Engineering Plc

While it is difficult at this critical moment of tangible pain to look ahead and consider how Covid-19 might lead to positive change, this is exactly what progressive countries in the world are doing. Many countries are already linking their post-Covid-19 recovery to a "green" agenda and they are also adding to it the notion of a "just transition". The goal is not only to accelerate the so-called Race to Zero carbon emissions, but to tackle social divisions and reduce inequality through the transformation itself.

For Thailand, applying such long-term thinking over short-term, profit-oriented or reactionary measures will be more critical than ever in the coming year. It may otherwise find itself permanently stuck in a situation of haves and have-nots, which could lead to intractable economic hardship and increased social turmoil over the next decades.

An example of such long-term thinking is the European Green Deal. It will mobilise at least 1 trillion euros (39 trillion baht) in stimulus and investments to be allocated to programmes that focus on "green" recovery: innovation-oriented, climate-friendly projects. The EU has made provisions for a "just transition mechanism" to make sure that the post-Covid recovery is a fair transition, and that it also benefits those who are at risk of being left behind. In the words of EU President Ursula von der Leyen: "People are at the core of the European Green Deal, our vision to make Europe climate-neutral by 2050. The transformation ahead of us is unprecedented. And it will only work if it is just -- and if it works for all."

In Thailand, the closest corollary to the European Green Deal is the Bio-Circular-Green (BCG) economic strategy, which is now officially part of the national agenda. The BCG strategy is an exciting platform that focuses on four pivotal industries for innovation and development: agriculture and food (1); medical and wellness (2); bioenergy, biomaterial and biochemical (3); and tourism and creative economy (4). The BCG model also explicitly recognises the rich regional and cultural diversity of Thailand by focusing on the different opportunities and needs of four "area-based corridors" -- the north, the northeast, the south and east.

As it develops, the BCG model must add, elaborate and promote its social objectives as well. Integrating a social justice approach into decarbonisation and sustainable growth will engage the public more directly in BCG's successful realisation. Leaders from government, state-owned enterprises and the private sector in Thailand can use the BCG model as a way not only to pursue economic competitiveness but to define a new social mission for Thailand. The BCG model can and should create meaningful income-generating opportunities in new growth areas for the poor and middle class, not only specialised emerging industries. For example, the International Labour Organisation (ILO) forecasts that a clean energy transition that meets the Paris Agreement's 2°C goal will also add 18 million jobs globally. The ILO also cites a UMass-Amherst study that found that every $1 million dollars shifted from fossil fuels to clean energy results in a net increase of five jobs, noting that "Green jobs expand across more sectors than just energy, including zero-emission vehicles and charging infrastructure, building retrofits, agriculture, forestry, and also care work including health care workers and teachers." It is worth noting that all of the sectors named are integral to Thailand's future as well.

Moving forward, here are some other examples of potential elements of such a "New Deal" for Thailand that might otherwise be overlooked.

The decarbonisation of the economy should go hand-in-hand with decentralisation. Homeowners, including the lower middle class and the rural population, can become "prosumers" in a decentralised energy market and become owners of energy-generating assets that both reduce their own energy bills and create supplemental income. In the coming years, Thailand's state-owned energy utilities can play a key role in the wide scale implementation of this through financing, technology procurement, installation, and operational support, thereby fulfilling their legally stipulated social mandate to serve the public interest. Another concrete example of a project that would represent what a just transition means: relaunching the energy-for-all scheme, which would allow private investors and communities to co-invest in power plants fuelled by renewable resources. This excellent idea has been discontinued by the current government.

This mission of a socially just transition should engage Thailand's top business families. In the US, Jeff Bezos has promised US$1 billion per year through 2030 to assist the fight against climate change through the "Bezos Earth Fund." The fund's CEO, Andrew Steer, announced that the Earth Fund "will invest in scientists, NGOs, activists, and the private sector to help drive new technologies, investments, policy change and behaviour." But, significantly, he added, "We will emphasise social justice, as climate change disproportionately hurts the poor and marginalised communities."

Policymakers in Thailand must take a whole society approach to BCG's implementation. In order to get societal buy-in for the BCG model, leaders must directly engage with the public at all stages. Other new partnerships and social contracts must be renewed or forged. For example, banks can play a key role, especially the rural, cooperative banks with substantial portfolios of bad loans (which are the result of increased inequality). They should be highly motivated to boost the incomes of the poor. Increasing the purchasing power of the poor and lower middle class is arguably the best strategy to get Thailand out of the middle-income trap. At the same time, reducing inequality cannot just fuel consumption-led growth. Rampant consumption would only counteract the green ambitions of this recovery.

Which is why we also need new ways of measuring success, to ensure that the difficult post-Covid-19 recovery also uplifts the well-being and happiness of the Thai people.

If Thailand's BCG model is too niche and technical in its application and becomes just another way to channel the profits of the next economic transformation to the same winners in Bangkok, then it will be a total failure. While "green" is in vogue today, the next generation must also perceive Thailand's decarbonisation as transparent and inclusive.

Implementing a just transition requires a major paradigm shift within Thai society, namely the strong realisation that we are in this together, that all elements in society are needed and treated fairly.

Only then will Thailand become more resilient to future shocks to its system and see its famed Thai smiles return to the faces of the people.


Ingo Puhl is a resident of Bangkok and co-founder of South Pole, a climate solutions provider and climate project developer: www.southpole.com

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