PROSPECTS FOR STRENGTHENING FOOD SECURITY
THROUGH INTERNATIONAL TRADE

Speech by Mr. Anand Panyarachun
on the Occasion of the FAO’s Celebration of its Fiftieth Birthday
given at the FAO Regional Office on October 16, 1995

Your Royal Highness, distinguished guests, ladies and gentlemen:

Fifty years ago, the Food and Agricultural Organization was founded to alleviate poverty and hunger by promoting agricultural development, improved nutrition and the pursuit of food security – “food security” being defined to mean the access of all people at all times to the food they need for an active and healthy life. It is time therefore that we take a long term look at how successful Asians have been in achieving these laudable objectives.

Many of us will recall the threat of famine that hung over Asia in the unsettled aftermath of the Second World War. Soon after that fear was removed, there arose a new fear that Asia’s food production capacity would not be able to meet the accelerated growth of population. It is amusing now to hear that there was concern in the early 1950s that Japan might not be able to feed her population. For those who had to live through that period, the outcome for Asia was still highly uncertain, as the region was hit by food crises of differing degrees of severity, first in the mid-1960s, and then again in 1972-74. Since then, the food situation in Asia has become far more secure, and the problem of food supply seems to have occupied less of political leaders’ time than it did only two decades ago. Nevertheless, the food crises of the 1960s and the 1970s seem to have generated a mind-set which is no longer relevant to the needs of Asia today.

The searing experience of the 1960s and the 1970s seems to have etched on the minds of many political leaders in Asia, that the international markets for food cannot be relied on. Looked at objectively, who can blame them? To take a few examples:

• the US has never been allowed to forget that in 1973, it imposed a ban on soybean exports.

• similarly, Thailand also banned rice exports in 1972.
• the US government was believed to have held up aid shipments to wring political concessions from India.

Even at the best of times, the international markets for food are greatly distorted by the actions of the major players, mainly, but not exclusively, the OECD countries.

Consequently, the great food crisis of 1972-74 was followed by a much greater emphasis on self-sufficiency among Asian policy-makers. It was also followed by an upsurge in food production throughout Asia. It would be nice to report that the slogan of food self-sufficiency caused the increased food production. However, sloganeering does not make plants grow. In the end what made the difference was the widespread adoption by farmers of new genetically improved varieties of rice and wheat – a phenomenon that has acquired the popular title of the Green Revolution. No doubt, the slogan of self-sufficiency helped to the extent that it set up a clear target, as well as pushing governments to undertake many activities in favor of farmers, for example, to invest heavily in irrigation. But without the varieties from the experiment stations, the investments would not have borne much fruit.

By the 1980s there was agricultural surplus everywhere. Asian countries had their Green Revolution. China had that plus a drastic reform of their agriculture. The OECD countries also weighed in. Prices having been high in the 1970s, their farmers refused to see them fall. Now in all OECD countries, agricultural prices are completely innocent of market forces and determined entirely by politics. When prices rose in the 1970s, and threatened to fall, their governments obliged the farmers by paying them much higher prices than what the markets could absorb.

Thus it came about that the great food crisis of the 1970s was followed by the great farm crisis of the 1980s. The farm crisis in turn led to hugely increased spending in OECD countries on farm support. Hence we arrived at a paradoxical situation, that countries that suffer from problems of over nutrition are also throwing the largest amount of public subsidies at food production creating a worldwide surplus, while hundreds of millions of malnourished people are unable to obtain a share of that surplus. Various mechanisms to rebalance the situation, most notably food aid, prove inadequate to the task. Commercial international trade also could not alleviate the situation, as what the malnourished poor suffered from was inadequate purchasing power.

The subsidies to agriculture in the OECD countries continued to grow, until they faced a real budget crunch. This crunch was ultimately responsible for the introduction of agriculture into the Uruguay Round. It came to be realized, certainly among the food exporting countries, that the state of anarchy that characterized international agricultural trade could not continue. Hence the long and arduous negotiations during the Round. It is a matter of some disappointment that the Round has as yet achieved little in the way of true liberalization, although I sincerely hope that over time, agricultural trade would be subject to less arbitrary interventions, particularly on the part of OECD countries.

While the Round was going on, in Asia (and indeed in other developing regions as well), many countries were beginning to liberalize unilaterally their economies in all sectors except agriculture. For many of these countries this resulted in a rapid export-driven industrialization. Agriculture and the rural sector in general have become increasingly marginalized. Because of these developments, the mind-set acquired from the food crisis of an earlier era is no longer relevant. In that era, the objective was clear and simple: a bigger pile of grains – almost regardless of costs. Now the problem is far more complex.

The spreading industrialization in Asia still requires a healthy agriculture alongside industry. But it will have to be a different kind of agriculture. The simple rule of maximising the pile of grains is no longer sufficient. As young people leave agriculture, rural areas tend to become increasingly depressed.

Faced with this new sort of farm crisis, it is tempting for industrializing Asia to close off its agriculture from the rest of the world. Without access to cheap food from abroad, and as people leave the farms, the lower supply would automatically increase food prices. The high food prices would then allow the remaining farmers to have higher incomes through higher prices, alleviating what would otherwise be a depressed agriculture. This is the path that Japan and Korea had chosen to follow. These are successful economies, and who can argue with success? But, ladies and gentlemen, I submit that this is the wrong path for the rest of us to follow.

It is a wrong path because it would freeze our agriculture to a pattern which would be increasingly irrelevant. Japan and Korea have made great strides in moving into technologically more and more advanced areas in industry, and conquering world markets. At the same time, its farmers are paid to go on producing rice (and they are paid generously), while its people are eating less and less of the stuff.

Can the rest of us afford this luxury? Can we not do better? Mythology seems to cloud all discussions of food and agriculture. To do better, we have to start by clearing our minds of some of these myths.

The first myth is that agriculture is static and technologically backward. This is simply false. Throughout this century, the application of genetics has borne fruit, and will continue to do so. It is precisely because of this dynamism that food prices have increased less than the prices of manufactured goods over the last hundred years. Of course, these scientific and technological advances do not fall like manna from heaven, but have to be striven for – they have to be invested in, both by the national government and by international agencies. In this context, FAO should be congratulated for its assistance in this respect, both directly and through the Consultative Group on international Agricultural Research (CGIAR).

Falling food prices, although of great benefit to mankind generally, not least to the urban poor, place increasing burden on agriculture everywhere. The burden is for every farmer to increase its productivity to keep ahead of the falling prices. And that productivity increase can only be obtained by putting more scientific resources into research. Past history has shown, and current science is indicating that further strides can be made in increasing farmers’ productivity.

But scientific resources are not exactly abundant. A poor, or even middle-income Asian country cannot afford to spread its efforts on every commodity, and certainly not in areas where it is unlikely to have comparative advantage or ever to acquire it. We have to learn how to invest our effort wisely and with discrimination. An agricultural economy which is divorced from the world markets is unlikely to be able to invest its scientific resources wisely.

An open food economy is sometimes held to be antithetical to food security. I now turn to this central issue of food security.

Food security can be considered at different levels. One can talk about world food security, or national food security, or food security at the household level. From a policy perspective, it is natural to center the discussion at the national level.

National food security is sometimes conflated with national security, with its military, life-and-death connotations. Since few can question action taken in the name of national security, it can be used to justify any measure. In particular, it is often claimed that national security can be ensured by food self-sufficiency – and this is the second of the myths that cloud discussions of food issues. If anything serious is to be read into this argument, it means that a country should prevent any disruption in its food supplies. Supplies from imports are deemed to be more vulnerable, particularly during a war, as international transport lifelines are the easiest to sever. Imports are thus naturally thought to be a less secure source of food than domestic supplies. Consequently, an agricultural work force has to be set aside to keep on producing food, even if it is not very productive in that line of work.

Consider another alternative to prevent supply disruption in times of emergency. Suppose the country stores grains and other food items to be used during emergencies. To reach the objective of national security in this manner is surely much less costly than keeping people unproductively occupied in agriculture, particularly when people so retained are mostly grandfathers and grandmothers.

FAO has given a nice definition of food security – “the access of all people at all times to the food they need for an active and healthy life.” The phrase “at all times” requires that there be certain stability in supply conditions. If that is so, then it seems to me that access of consumers to international markets (when and if necessary) would enhance food security more effectively than a closed supply system.

But the definition also says “access of all people.” We should pay special attention therefore, to the access of poor people, since they may not have the wherewithal to buy adequate quantities of food. We have seen that a bigger pile of grains by itself does not assure that the poor can buy food. Ultimately the poor will have to have better incomes to be able to buy the food. In other words poverty will have to be eliminated for food security to be attained.

Now Asian poverty is still primarily rural poverty. The fate of the rural poor is therefore, tied up with the health of the agricultural sector. A closed-in, protected agriculture is unlikely to be a healthy agriculture. If high prices are the objective of such protection, then they will benefit only those lucky enough to have access to farm lands, and will not trickle down to those who are landless or have small plots of land, surely the most vulnerable group. Those who wish to enter the ranks of the landed will find that land prices are usually prohibitive under protection. Furthermore, the high domestic price of food that a closed-in system often produces is certainly not going to help those poor who have to purchase it.

A healthy agriculture, I submit, does not depend on high prices. It depends on efficiency. Efficiency cannot be gained by protection. What protection does is to freeze agriculture into becoming a museum piece.

Small farmers and landless laborers depend as much on an efficient agriculture to give them employment and improve their lives. The choice of what crops to grow, what technology to use, will take better account of their availability to provide their most important resource: their labor and their skills. And if their lives are sufficiently improved for them to aspire to own more land, they will find the land prices to be less prohibitive.

Therefore, to have a healthy agriculture, and with it wealthier farmers, a country needs to open up its farm economy to international trade. This will allow the farmers to specialize in those crops which best suit its resource constraints. To take a concrete example, normally most cereal grains (except rice) can be grown with relatively little labor and a great deal of machinery, as they are in the great grasslands of the “new” countries such as the US, Canada, Australia and Argentina. Asia on the other hand is blessed with a large population and work force, and relatively little land. With such resource structure, to insist on growing one’s own food to feed one’s own population is good neither for the urban poor who are forced to eat expensive grains, nor for the rural poor when the rural economy could be growing something else which yield higher value in the market place.

A more market-oriented policy may make farmers move away from grains, as in China, and they will do so only because it is profitable to them and to the rest of the economy. It may also make them move towards grains, as the example of Vietnam has shown. When Vietnam’s economy was opened up, it went back to the comparative advantage it has always had in rice production, to expand rice exports – this after twenty years of regular imports. Large exports since 1989 have not only increased rural incomes but allowed it to buy capital goods from the rest of the world to develop and diversify its economy.

I conclude, therefore, that for a viable and sustainable food security policy to emerge, therefore, a more open agricultural policy is necessary. But a government, having implemented this policy, should not sit back and pursue a completely laissez-faire policy toward agriculture. Agriculture has traditionally depended a great deal on public investments, particularly in Asia, where governments have poured in vast resources into irrigation. Of equal importance is investment in agricultural research, even though the sums involved are considerably smaller. Now, public investments in agricultural research are more necessary than ever, and have to be redirected to the new economic structures that Asia faces. I have no doubt that there are in Asian rural areas considerable productive potential that is suppressed by the misguided policies of today. The misguided policies have to be removed, but the productive potential has to be actively enhanced also.

The international community can in the meantime also continue to push for further doses of reforms to clear up the tangle that has bedevilled international agricultural trade. The US, EU and Japan have obtained great “benefits” from the Uruguay Round in that they are allowed to continue to waste more money on an over-priced agriculture. These rights should not give us in the rest of Asia the excuse to waste our own money too, for we can afford to do so less than they. We need therefore to advocate in the GATT and in APEC, among other fora, that the rich countries should be saved from their own follies.

Poor people do not need government handouts, whether those handouts take the form of cash or in the forms of distorted prices for things that they produce or consume. They need to be productive citizens. For many in Asia, agriculture is still their main business. The current system in world agriculture does not allow them to participate fully in it and make the full contribution that they can. And it is only when they have reached their full productive potential can they attain a long-lasting food security.

Speech by H.E. Mr. Anand Panyarachun
for the International Conference

“Global Public Health Perspective:
Where Do We Go from Here?”

Siam International Hotel, Bangkok
November 16-18, 1998

A quest for a new world order:
A place for women and children

Honoured Guests, Ladies and Gentlemen,

I am pleased and honoured to have the opportunity to address a conference that celebrates the 50^th anniversary of two institutions, the world Health Organization and Mahidol University, both committed since their origin to the ideals of scientific advancement and equal opportunities for every human being to secure the fruits of technological progress.

The most difficult period of history to understand for us is always the present in which we live. It is, therefore, a tricky undertaking to guess the features of a new order that human kind is forging, consciously or not consciously. For sure, the suddenness and scale of changes in the last twenty years suggest that we are living through a sequence of revolutions.

Probably the unprecedented development in communication technology is the main common determinant behind tremendous recent changes that ranges from the end of Apartheid to the narrowing of ideological divides, from the collapse of many dictatorships to the end of state economic monopolies and from the boom to the recent fall of Asian economies.

Here we will not examine detailed aspects of each of these changes with their explanations. The theme assigned to me has a clear assumption: to be worthy of its times and capable of meeting the challenges of the future, any new world order has to be propitious for children and women to develop their full potential. I accept this assumption when I discuss here the quest for a distinct place for women and children in a new world order. I strongly and sincerely believe that this requirement, although especially important for the third poorest part of the world, has a strategic importance for the whole planet.

The quest for a place for women and children in a new world order requires a conjunction of wills, hearts, minds and hands. To support this quest with consistent actions we have to refer not only to our values and ethical principles, but also to some lessons learned from the collective experience.

Most key elements that we want to see in the new order are already explicit in the Charter of the United Nations and in the national constitutions that during the past century have guided dozens of countries around the world. Moreover, some new sound elements have been widely accepted and endorsed, particularly in the last two decades, in a series of international conferences on development, population, environment, women and children among others. I would like to propose here six ethical principles and lessons learned that constitute, in my view, “imperatives” for a new world order that favour women and children. These are:

With the highest priority – a first call for children. Essential needs of all children should be given high priority in the allocation of resources, in bad times as well as in good times, at the national, international as well as at family levels.

Second, a new order should oppose the apartheid of gender as vigorously as the apartheid of race. To discriminate girls in the educational opportunities is an unacceptable mistake. Employment rights, social security rights, property rights and even civil and political liberties should not depend on one, unfortunate little chromosome.

Third, if the issues of malnutrition, preventable disease, widespread illiteracy and poverty are not confronted as a new world order evolves, it will be so much more difficult to reduce the rate of population growth and make the transition to a form of development that is environmentally sustainable.

Fourthly, the growing consensus around the importance of market economy policies should be accompanied by a corresponding consensus on the responsibility of governments to ensure and promote basic investments in people.

Firth, the international action on debt, aid and trade should create an environment in which economic reforms in developing countries can succeed in allowing ordinary people to earn a decent living.

Last but not least, is democracy in a broad sense of the world, political freedom, decentralization, transparency in government action, and participation of women in politics? These are not just desirable and suitable for certain countries: in the Four Corners of the world these have proven to be clear paths to economic and social development.

Too many times in history have experienced economists failed to predict economic trends, no matter how much was invested in preparing those predictions and how many mathematical calculations were used. But here, I am not afraid to say that the imperatives above, if put in practice, will serve to strengthen social and economic development, not just in the long run, but also in the short and medium term as well.

These paths are not without their pitfalls and every country must proceed at their own pace. Government endorsement and general awareness on child rights and non-discrimination against women have grown tremendously in most parts of the world. However, in places like South Asia and Africa, millions of children die of preventable diseases, and hundreds of millions of women still suffer gross discrimination. AIDs and economic stagnation are threatening remarkable achievements in women and child health that were obtained in the last few decades. Global military expenditures are on a downward trend, but today there are more civil wars going on than two decades ago. Awareness on environment protection has grown substantially, and sustainable development proposals prevail in the discourse, but, in practice, the risk of major ecological crisis is growing a bit every day.

Still, we feel that these causes are far from being hopeless. The principles I have just outlined are based on solid arguments and extensive experience. The special vulnerability of children is well known: in their first three years both survival and future development are constantly at risk. Every child, boy and girl, if well educated, will be able to give his or her unique and valuable contribution to humanity, including in the economic sphere. Contrary to a somewhat current opinion, improvements in child survival have never accentuated population growth: families that are more knowledgeable in the care of children and confident in their survival are more motivated to avoid unwanted pregnancies.

In a desirable new order, it may be appropriate in most cases to reduce the involvement of the government in the production and delivery of certain services. But women and children will still need a competent public sector to promote prevention and care, and provide accessible quality schools and other institutions dedicated to education. Many of our countries stagger under the burden of external debt. Yet we continue to deny that the bulk of these debts have to be paid by the masses – the most humble labourers and their families. This will definitely not produce lasting growth, and furthermore, will not prevent the repetition of similar situations in the future. Democracy and decentralization have a special reason to be regarded as crucial factors to produce a new order: they are much more compatible with the unstoppable growth of free communication than other ways to run a government.

The rationale of the six imperatives that I proposed appears clear from the considerations above. Let us look now at ways each country can ensure that these six imperatives will influence the lives of real people. A new international order will, of course, be made of a sum of facts that happen in individual countries.

We have to see the Convention of the Rights of the Child (CRC) and the Convention on the Elimination of all forms of Discrimination against Women (CEDAW) as key instruments. These particular conventions not only produced declarations, but were also followed by official treaties with mechanisms for international monitoring. The process of reporting on the national compliance to the international bodies may be, in itself, a powerful tool for change if the discussion on the articles of these conventions is popularized. This is beginning to happen in various countries, including Thailand, and we hope that this practice will extend until it is the norm, rather than the exception.

In many countries, free elected governments ratified these conventions. It is then democracy that will support the enforcement of regulations that emanates from them, while the dissemination of information by the many new formal and informal networks will in turn support democracy in this process.

Still, we must be aware that international treaties, national laws and regulations and international monitoring of indicators are not sufficient to guarantee these rights. Even wide, intensive and popular discussions on the compliance with these treaties will not be sufficient. We need comprehensive government plans that are adequately funded within the limits of national budgets. Also, these plans have to be carefully administered and monitored.

Participation of key non-government stakeholders in the preparation and implementation of the plans will contribute to better define the objectives, to find out the most appropriate ways to achieve these objectives and to monitor, evaluate and readjust strategies. Diversity of perspectives has to be valued as an asset and no more as a problem. Each country might find out its own way to get meaningful and effective participation: some have created effective commissions for women’s affairs, some have proposed integrated special committees and task forces for children, or even a special Ministry for children. Some others, instead, did a serious job in putting the specific concerns with women and children needs and rights into the routine work of a variety of institutions.

I see that some major objectives, such as AIDS prevention and care, or ending of trafficking of women and children, also deserve specific national or even regional plans, endorsed at the highest political level. Special challenges for these objective oriented plans being:

• to break down the barriers among sectors;
• to harmonize the contribution of government, private sector and NGOs; and
• to specify objectives and strategies for the short, medium and long term

We regard these challenges above, together, as an additional imperative that arises from decades of experience in working for and with women and children. They remind us, for example, that physical, mental and emotional health, development, education and special protection have to be addressed simultaneously, in a balanced fashion; that independent women’s organizations have a lot to contribute to the effectiveness of programmes for AIDS control, for a safe motherhood, for sanitation or for poverty alleviation; that children have to be prepared for the future in a fast changing world, but their future is also decided today, because today an avoidable disease might impair forever this future.

Now different actors have their roles to play, and different responsibilities in providing a place for women and children in the new world order, I would like to look at two of them, namely the governments and the scientific community.

A pivotal role of the governments is to provide universal and equal opportunities at least for survival, and to promote early childhood development and elementary education. Besides this typical mandate in the sphere of well-known basic services, children and women need to have access, systematically, to channels and services that deal with abuse and other gross violations of rights. All this is valid for all countries and, especially in the poorest, requires careful prioritization among different alternatives.

Changing the balance of existing expenditures in favor of the poor majority is necessary in many cases. Some countries have succeeded in this, but not without huge difficulties. It is not easy, for example, to shift the priority from national airlines to domestic bus routes. Where democracy is strong it may be easier, but in general this is more like to happen if overall resources are expanding rather than contracting. This brings the discourse to economic development, to access to international aid and, of course, to the adjustments that, in periods of crisis, are supposed to restore development.

An interesting approach is that, even in a market economy context, targets for development plans should be first expressed in terms of basic human needs, and only subsequently translated into physical targets for production and consumption.

Too much international aid goes to unconnected projects rather than in support of a set of policies and strategies agreed upon in recipient line ministries, coordinated with plan and finance, and approved at the political level. As a consequence, too often requests and responses to aid tend to favor expensive and even unsustainable capital-intensive efforts likely to benefit the higher income brackets in society.

Although the aim of adjustment programmes is to help restore financial stability to accelerate growth, these should always include strategies to alleviate the negative effects on the income of the poorest. Employment and, particularly, programmes in education, health and natural resource protection should be protected.

We insist, in other words, in a better targeting on the part of the recipients as well as on the part of the donors. A recent initiative, called “20/20” pursues this objective. This was launched in 1992 by UNICEF and UNDP, and proposes that at least 20% of the national government expenditure has to go to health, education, water supply and sanitation, while at the same time at least 20% of external aid also has to go for these same areas. So far no developing country and no donor have complied with this target.

As for the scientific community, represented in this room with many exponents in the area of public health, certainly has a role to play to ensure a place for women and children in a new world order. Representing 80% of the World population, developing countries account for 90% of the world’s burden of illness and disability. Yet, excluding research on AIDS, only 5% of the global expenditures on health research is devoted to the health problems of developing countries.

In the area of basic research, in order to explain the mechanisms of diseases and for technology development, we see the need to increase allocation to respond, for example, to the unanswered questions related to respiratory infections and malaria, with high impact on poor children all over the world. Such researches are better carried out through international collaboration and exchange, and should involve institutions in both the developing and industrialized nations.

Even more emphasis should be given to support with additional resources, the better understanding of the most suitable ways to ensure the successful application of existing knowledge, as well as the efforts to improve surveillance of behaviors and diseases. This type of study, to be strengthened in developing countries, includes epidemiological field studies, health communication surveys, studies on drug suppliers and demand, health services financing and information systems in support of management. This knowledge will enable planners and managers to better establish priorities and design programmes that might channel limited resources to benefit more people.

Similar considerations have to be made on the research on education and on selected social issues, especially related to women and children, such as violence and other behavior-related fields. In developing countries, an increase in the support for good quality studies on service supply and demand. Management, communication and cultural aspects involved in these fields would have a great return for women and children.

In conclusion, I would like to declare my optimism for a new order, or, more simply, for the new times ahead.

Like the Universal Declaration of Human Rights that emerged in 1948, the Convention on the Elimination of all forms of Discrimination against Women (CEDAW) from 1981, and the Convention on the Rights of the Child (CRC) from 1992, were conceived to last for centuries, such is the strength of the principles that sustain the articles of these documents.

This strength suggests that their survival, with growing enforcement, for one millennium or more is not pure Utopia. We can look at these human rights as proposals and aspirations. We needed thousand of years of suffering, struggle and, of course, improvement in communications among nations and people to reach a consensus on this comprehensive spectrum of proposals. Many of these aspirations are rooted in most traditional cultures. We don’t need to contradict the principles of any religion or culture to affirm the validity of the CRC and the CEDAW.

These treaties are typical products of a new era, where no nation and no village live any more in absolute isolation. Although knowledge of the treaties still eludes perhaps half of mankind today, they are nevertheless known and valued by millions of individuals all over the planet.

We feel that these millions of people may make a difference, by helping to accelerate the compliance with established rights, also by disseminating the new ideas to others. Many organizations too, much more than ever, are exercising their creativity to preserve and uphold women’s and children’s rights. They form a critical mass that share the mission of upholding these rights. Their members and leaders are professionals or volunteers who operate in the public sector as well as in NGOs. Diverse in culture and backgrounds, they are involved in delivering services at the grass-roots level as well as in discussing solutions with some degree of abstraction. Their power is growing, allied to the well-known rapid improvement in communications.

Peter Senge, a known thinker of modern management, said that the organizations that will prosper will be those capable of recognizing the value of the “many leaders” within them. The same applies to the world as a whole. The hope of a worthy order, with a place for women and children, resides in the strength of the “many leaders” that will put their hearts, brains and hands at work for this ideal.

Keynote Address

by Mr. Anand Panyarachun
“The Role of Environment Protection
in National Development
Environmental Protection and
Rural Development in Thailand
JW Marriott Hotel, Bangkok
November 3, 1999

Tonight, by the time that we go to sleep, the earth will have changed. It will be a little warmer, the rains a little more acidic, the area of forest reduced, a few more species pushed closer to extinction and less fish swimming in the seas. In short, the fabric that supports life on this planet will be a little more threadbare and we will have an additional 250,000 people to feed.

The title of this Roundtable “Environmental Protection and rural Development in Thailand” is hence not just of national concern, but great international significance, focussing on one of the greatest challenges facing society as we draw to the end of the millennium.

Canada and Thailand, although ostensible very different, have some critical aspects in common with regard to the main theme of this Roundtable.

Both countries are major repositories of biodiversity with globally significant species and populations of wildlife. Charismatic “flagship” species, such as the tiger and elephant in Thailand and polar and grizzly bear in Canada, give both countries a high profile on the international biodiversity stage.

Second, both countries have established protected area systems, such as national parks, that play a major role in biodiversity protection. This is in contrast to much of Europe, for example, where parks are mainly of recreational significance.

Third, the protected area systems in both countries are of high public concern and often featured in the news. Both countries are currently expanding the size of the protected area systems, and giving increasing attention to management for biodiversity. However, both countries also have significant tourism industries, and the national parks attract a lot of visitors. A major challenge therefore for both countries is how to manage the national parks to protect biodiversity but also allow for appropriate use.

Fourth, both countries have significant populations of ethnic minorities, including indigenous peoples, who still have close tie to the land and must be included as active participants in land-use decision-making. Canada, for example, has developed several different models for including participation by native peoples into decision-making in national parks. Thailand is also seeking greater input from hill-tribe peoples on certain issues relating to natural resource management decision-making.

Fifth, both countries are committed to greater public participation in resource management and developing appropriate means to include them. The New Constitution in Thailand is quite specific in this regard.

Sixth, both countries recognise the importance of implementing sustainable approaches to rural development throughout the landscape. Vast areas of Canada are rural, with people dependent upon resource development. In Thailand, a large proportion of the population is engaged in agricultural activities. Environmental protection must take these important rural populations into account.

It is perhaps due to these similarities, most of which contrast markedly to the European context, that Thailand and Canada have established joint programs at many different levels including government sponsored aid projects, academic exchanges, student training and research projects to explore some of the challenges being faced in the field of environmental management.

Need for Environmental Protection

Every day brings greater scientific confirmation of the role that humanity is playing in changing global environmental systems. Now, however, it is not only scientists who are aware but also the general public, as the news is full of stories regarding the latest cyclone, flood and drought that not only seem, but actually are, occurring much more frequently and with greater intensity than in the past.

In the U.S., scientists have found that precipitation has increased by more than 10% this century, and a greater proportion is coming in storms. Insurance payments for Canadian weather disasters have been doubling every five to ten years, and payouts reached $1.5 billion last year. There are now suggestions by the insurance industry, who are taking global climatic change very seriously, that the Canadian government establish a national disaster reduction fund of between $100 to $150 million. The insurance industry has also established its own research institute looking into weather-related issues, with over $9 million in funding.

The bottom line here is that climatic change is very expensive to fix.

With these changes has come the realisation of the values that natural systems provide for society that we often don’t take into account. They create our atmosphere, so that we can breath, influence the weather and regulate the hydrological cycle for our agriculture, and provide many raw materials from bamboo shoots and hardwood timbers to medicines to support our livelihoods and well-being.

The total value of these services is difficult to measure. One team of scientists form Cornell University calculated total values as over $2.9 trillion per year, or 4 times the total value of the British economy. A more recent estimate from the University of Maryland put the value as 10 times greater than the earlier estimate and larger than the total global economy.

What is obvious from this is that although we can measure the distance between the earth and the moon down to the nearest half centimetre, but we are only just starting to approximate the value of the biosphere that keeps us all alive.

It is only as we pass the 6 billion mark for global population on our way towards the end of this millennium that we are becoming aware of the value of these ecosystem services, and the need to make sure that they are protected as a fundamental contribution to sustainable development for this and future generations. Protected area systems occupy a small percentage of our landscapes, but in these small areas we protect ecosystem values from the market values that predominate on the majority of the landscape. Not developing these areas is a fundamental plank for sustainable development in the landscape as a whole.

Need for Enhanced Knowledge

The so-called “Green Revolution” has enabled food production to keep up with burgeoning populations for the last forty years, until very recently. Besides hybridisation of crop plants, a major tool in the Green Revolution was the addition of fertilisers. Without fertilisers, starvation would be a reality in many more parts of the global than it is now.

However, there were costs to these innovations that we didn’t realise at the time. Nitrogen fertilisers, for example, denitrify back into gaseous state as nitrous oxides. Nitrous oxides are a main agent involved in the catalytic destruction of the ozone layer in the atmosphere. Destruction of the ozone later lets in more ultra-violet radiation from the sun, which in turn reduces crop growth, which reduces agricultural productivity.

The point of the foregoing is to emphasis that the impacts that we are having on global systems are not only very large scale, bot that they are also very complicated. In order to work towards sustainable development it is necessary to have greater scientific understanding of how environmental systems work and how to implement optimal management activities. Such understanding calls for the investment of considerable societal resources in education and capacity building. We can no longer blunder along under the auspices of a benign and all accommodating environment. The environment is no longer able to absorb the costs of our mistakes without major retribution. Global climatic change, declining biodiversity, fisheries collapse, pollution are all telling us this.

In the future we will have much less room for mistakes, much less environmental elasticity. We will need our best brains, to be well trained and well-equipped in order to advise society on the right moves to stay on the tightrope on which we now find ourselves. Universities must play key role in meeting this challenge and our graduates and faculty must rank amongst the best in the region, if not the world.

Need for Better Implementation

It is not enough to merely know the right road down which we need to move, we must also have the right vehicles in which to travel. This task, the implementation of programmes that best serve societal needs over the long run is a fundamental role of government agencies. The new knowledge and the new road require dynamic agencies constantly reacting to the challenges of the future and not mired in the old ways of doing things.

We need to try new programmes, listen to new voices, accept and plan for uncertainly. We need, in short, to invest in agency renewal that will look at different ways of doing things. This is not to suggest that all is static within government offices, but rather to suggest that the scale and pace of change will need to be far greater than anything that has ever been considered before.

Do not Forget the People

For too long society has been split into two groups, the “planners” and the “planed for”. The planners were usually government agencies charged with delivering state services throughout the country. The “planned for”, were the rest. Unfortunately there was often little contact between these two groups that, in theory at least, were closely related. The planners forgot who they were ultimately planning for; the “planned for” were never told what was being planned for them.

Inevitably conflicts started to arise between these two groups and between other groups in society regarding delivery of many state programs. Demonstrations, and even mass unrest became common over many government projects, dam building, pipelines, national park establishment, power stations and many others. Part of this conflict arises from a misunderstanding of the need for the development. Conflict also arises from disagreement about how the costs and benefits of the projects are calculated and fundamental differences in opinion about such issues as the rights of the state versus the rights of individuals and visions of the future for Thailand.

These kinds of concerns can no longer be swept under the rug. They must be brought out and discussed freely in public sessions. The new constitution makes it quite clear that increased public involvement in decision-making is a right for all Thai people. The challenge now is to find appropriate ways of re-weaving the people back into the fabric of societal decision-making.

A New Kind of Development

Thailand experienced world-leading economic growth rates through the 1980’s and into the 90s. Then came the financial crash. Although this has been a very difficult period of transition for many, the experience has not all

been negative. It has turned attention, prompted by the wise words of His Majesty, towards a more self-reliant kind of development that focuses on values rather than economics. This is exactly the kind of development that the world needs going into the second millennium. So out of the crisis has risen opportunity, and that opportunity is for Thailand to refocus its development goals with a greater understanding of the need for environmental values and protection to go hand in hand with social values towards a more fulfilling future.

Conclusion

In conclusion, the tittle of my talk was the role of environmental protection in national development. It should be clear that I think that environmental protection is a prerequisite for national development in the future. We should not look at protected areas as being locked away, wasted to human use. Instead we should see them as an investment in our children and in the future.

Over the next 50 years it is likely that global populations may double again. Even with the stable and predictable Earth of the past, the difficulties with providing livelihoods for this number of people would be chilling. However, on the new, unpredictable Earth with increasing uncertainty regarding weather patterns, floods, droughts and cyclones, it is going to be a very challenging world for our children to inherit.

Two things we can bequeath them are, first, to implement policies to minimise the human-caused changes to the environmental fabric of the planet, and second, to protect small areas of our landscape as national parks and other protected areas that will help absorb these changes and restore ecosystem processes in the future.

This much we owe to our children, and our children’s children.

“Role of NGOS in Changing Societies”

by Mr. Anand Panyarachun
World Vision International
Asia-Pacific Regional Directors’ Conference
Regional Forum
November 16, 1998

Members of the World Vision International Board of Directors

President of World Vision

Vice-President, Asia-Pacific Region

Distinguished Participants

Ladies and Gentlemen

It gives me great pleasure to join you at this important Conference. I have accepted the invitation to speak to you tonight out of admiration for the useful developmental work of World Vision, not only in Thailand but in other countries of the world.

My presentation on the “Role of NGOs in Changing Societies” will address three issues, namely:

1. the changing macroeconomics situation in Thailand;
2. its impact on Thai society; and
3. the role of NGOs within that context.

Changing Macroeconomic Situation

All of you are aware that Thailand has the dubious distinction of being the country that jump-started the present economic crisis in East Asia.

The economic crisis has demonstrated that, even though liberalization typically encourages competition and efficient use of resources, it can generate excessive spending or bubbling of the economy leading to economic and social instability

We can trace the root of our difficulties back to 1985, when after the Plaza Accord, the Japanese Yen appreciated greatly. This motivated Japanese enterprises to shift their production overseas. Much of this shifting was to Southeast Asia, where low wages helped maintain a competitive edge. Those streams of investment sparked the “Asian Miracle.”

Economic growth in Southeast Asia at that time accelerated to over 10 percent annually. Such a remarkable pace of growth misled both the private and the public sectors into undertaking excessive investments. Spending sprees were fueled by borrowing from both local and foreign sources.

In the early 1990s, Thailand started to liberalize not only her capital account but also her financial institutions. Private corporations, therefore, had more credit access. The exchange rate stability induced them to tap low interest funds from abroad to finance their projects. Because of easy credit, the private sector often overlooked project feasibility. There was much investment in non-performing sectors.

In the meantime, domestic financial institutions were pressured by growing competition to the extent that their credit extension was executed in a reckless manner. Consequently, the country’s external debts, particularly short-term capital, surged to a precarious level, as did the current accounts deficit as well as inflation.

Simultaneously, local banks and finance companies encountered more problem loans. Their asset quality fell to such a distressing level that the central bank was compelled to provide them with enormous rescue credit lines, which worsened the country’s macroeconomic position.

These imbalances considerably undermined confidence of both lenders and borrowers about the stability of the Baht, resulting in floods of capital outflows, which were exacerbated by speculative transactions. Such capital flight was frightening enough for the central bank to abolish the basket pegged exchange rate policy and float the Baht.

As you know, after floatation, the value of the Thai Baht depreciated considerably. To mitigate the crisis, the Thai government sought assistance from the International Monetary Fund. The rescue package stipulated many economic conditions, including establishment of high interest rates, limited budgetary expenditures, and stricter banking rules.

Impact on Thai Society

What has been the impact of the economic crisis in Thailand?

Firstly, the substantial Baht depreciation together with the IMF conditions resulted in the contraction of consumption and investment spending in Thailand.

We are also experiencing record unemployment. The economic downturn brought about cuts in production and reduction in the demand for labor or employment. The number of unemployed more than doubled from 2.1 percent of the labour force in 1997 to 4.6 percent in 1998. The number of private corporations that ceased operations rose by 134 percent, from 4,067 cases in 1997 to 9,543 in the first nine months of 1998.

There has been a soaring rise in the price of consumer products, particularly for basic commodities. Inflation has risen from 4.4 percent in 1997 to 10.2 percent in May this year.

Hence, the impact of the crisis, in terms of jobs and basic commodities, has been felt hardest by the poor and other disadvantaged groups in Thai society.

As families strive to make ends meet, children become an inevitable casualty of the crisis. Job losses among parents and the drastic reduction in disposable family income has meant that many children have had to drop out of schools.

Surveys by the National Education Commission conducted this year indicate that out of a total of about 793,000 dropouts, some 254,000 or 32 percent were as a direct result of the crisis. These include children in primary and secondary schools, in both general and vocational education.

Experience has shown that crisis-induced stress may aggravate the already growing problem of domestic violence and abuse in the family. Cases of suicides are reported in the press every day. Children and youth in and out-of school are driven to substance abuse.

The World Bank, recently, forecasted that the number of people living in poverty in Thailand would rise from 9 million to 13 million. That would constitute 23 percent of the total population by the year 2000.

Nevertheless, despite necessary cuts in spending, compelled by the IMF restructuring policies, the Government has made a commitment to maintaining social expenditures, particularly in the areas of health and education. With the assistance of international financial institutions, such as the World Bank and Japan’s Overseas Economic Cooperation Fund, measures are being adopted to cushion the social impact of the crisis on the most vulnerable groups, including children.

Through the government’s US$462.2 million Social Investment Plan, funded by the World Bank (US$300 million) and Japan’s OECF (US$123.3 million), Thailand’s social safety net has been strengthened through the creation of employment, provision of training and easing of access to health and education. The SIP plan is meant largely for government and state enterprise projects, as well as for self-initiated, community-based projects and the decentralization of development activities. For the latter two purposes, the Social Investment Fund (SIF) of US#132.57 million and the Regional Urban Development Fund (RUDF) of US$41.57 million will be set up respectively. So far 1.4 billion Baht loan has been approved by the World Bank under the Social Investment Plan to provide training for laid-off workers, women and child workers, disadvantaged women and the disabled. The US$500 million loan from ADB for the social sector programme focuses on support for laid-off workers and unemployed and the maintenance of certain subsides for the poor, for labour market improvement, and for health and education programmes.

The Centre for Assistance to Laid-Off Workers has been established by the government under the existing network of the Ministry of Labour and Social Welfare to register laid-off workers and provide one-stop service in the forms of training referral, counseling and placement support. Interventions by the government have created jobs for 125,864 unemployed and laid-off workers in the rural areas, found new jobs in the industrial sector for 254,894 laid-off workers, and helped 40,290 Thai workers to find employment abroad.

It is my belief that the current crisis provides us with an opportunity not only to reassess our economic policies, but also our social agenda. And this requires a reexamination of the role of government and civil society in providing social entitlements to the people, particularly the disadvantaged sectors.

Role of the NGOs

There can be no denial that the primary responsibility for maintaining basic social entitlements for the people rests with Government. However, experience in Asia points to the growing role of civil society, namely NGOs, in the planning and delivery of social services to disadvantaged groups.

It has been said by some that NGOs have a comparative advantage to Governments in implementing social programmes for the people. If that is true, what are some of these perceived advantages?

1. The first may be that NGOs recognize the need for participatory planning of programmes for the poor, something which still tends to elude Governments. The involvement of the intended target group in the actual design of a programme is considered crucial for its success. Through their grassroots contacts, NGOs have direct access to the people and are in position to involve them in planning processes.
2. The second advantage is that, through their well-established involvement with disadvantaged groups and marginalized communities, NGOs have earned a certain degree of credibility and trust among their constituencies. In working with the poor, trust is an essential element for the success of programmes.
3. Responsiveness and speed are also the hallmarks of NGO operations. Compared to Government, which is bogged down by cumbersome bureaucracy, NGOs are more flexible in their operations. They can respond more quickly to address various situations. Government administration tends to be mostly top-down, whereby the real needs of the people are often overlooked. It is usually the opposite for NGOs. They can more easily grasp the reality and the urgency of the problems faced by the people. They can act quickly to respond to their immediate needs.
4. NGOs have a reputation for being more innovative than government in their mode of operations. There is more room for creativity and experimentation. Non-conventional approaches can be tried and tested. NGOs have proven that they are particularly well-suited to the implementation of programmes geared to community participation or requiring collective decision-making by client groups.

I have provided you with some examples of the reasons for the success of NGOs in the field of social development. While their achievements have been laudable, we must look ahead and map out the challenges that lie ahead for NGOs as we enter the twenty-first century.

I believe that the true test of success for NGOs in Thailand will be their ability to influence Government and changes in development policies. Hence, I would urge you to focus more action in the following areas:

• Promote constructive dialogue with Governments on issues of interest to your constituencies. Share your knowledge and experiences with them. You are well placed to stimulate and revitalize thinking and practices, which could best serve the people.

• Provide Government with examples of best practices in planning and delivery of social programmes. In this way, the micro-level experiences of NGOs can be brought to a macro-level, thereby ensuring greater impact of programmes at the national level.

• Monitor the actions of Government to ensure accountability and transparency. You have a “watch dog” role in ensuring that the principles of good governance are respected by the ruling party.

• Raise public awareness of the legitimate rights of the people and mobilize constructive community action to demand change for the betterment of society;

• Network among yourselves. Gain a bigger voice at the national level through consolidation.

• Focus attention also on your internal operations, including your personnel. The success of your operations depends on the quality of the human resources of your organizations. NGOs workers are the ones who come into direct contact with your constituencies. They are the ones who are delivering the services to the people. Hence, it is crucial that they be well motivated and possess the necessary skills to effectively carry out their work.

What I have just outlined are areas that I feel NGOs should emphasize to make a stronger impact in Thai society.

With the growing social problems and human sufferings arising from the economic crisis, your role in promoting social development assumes even greater importance.

NGOs, such as World Vision, have already contributed immensely to assisting disadvantaged social groups. In relation to your programmes for these special groups, particularly children, I would urge you to work towards strengthening the family as well as communities, as they serve as the basic institutions in our society for ensuring child welfare.

The goal of your programmes should be to provide an enabling environment for families to function effectively as caregivers for their members, as well as for communities to become sufficiently strong to provide social safety nets. Your programmes should promote community participation from the beginning, and, subsequently aim to promote self-reliance. In doing so, you will ensure sustainability.

I am confident that World Vision will be able to accomplish these goals and reach out even more to those who are in need of its services.

Keynote Address

By Mr. Anand Panyarachun
Chairman, Council of Trustees, Thailand Environment Institute
Former Prime Minister of Thailand
The Three E’s: Electricity, Energy and Environment
At the Twelfth Conference on the Electric Power Supply Industry
(CEPSI)
Dusit Resort Hotel, Pattaya
November 2, 1998

Distinguished Guests, Participants, Ladies and Gentlemen

It gives me great pleasure to address today what is certainly the most impressive group of global electricity supply leaders ever assembled in Thailand. And I hope that your presence here reflects a strong interest in Thailand. Although the current economic outlook is not as bright as it once was, we are working hard to restructure our economy, restore our faith and rebuild a business climate which will once again be conducive to growth in the near future.

Today, I shall share with you my views and vision on the reconciliation of electricity, energy and the environment in the 21^st century. Before I continue with my speech, I would like to take this moment to congratulate the host organization, the Electricity Generating Authority of Thailand, better known as “EGAT”, for their tremendous effort and hard work in producing the exceptional turnout for this meeting. Somehow, I do not feel at all a stranger in this place, even though I cannot really proclaim to be an electrician or an environmentalist. However, during the past decade I have been associated with several organizations both in the public and private sectors that significantly influence the power industry. Besides the Prime Minister, my affiliation with two distinguished organizations, the Thailand Development Research Institute and the Thailand Environment Institute, has significantly amplified my interest in the development of sustainable energy. As businessmen, several of our investments are in industries which use electricity as a major resource component, and also in the electricity supply industry, itself, a power producer. Therefore, what I am going to present today will be the emerging key issues as I see them and the need to enhance the balance among a handful of concerns that all begin with the letter “E”, Electricity, Energy, Economy, Efficiency, Equity and the Environment.

Electricity: An important Fuel for Economic Development and Quality of Life

Faced with the fragility of today’s regional or perhaps even global economic situation, current energy security problems and conversation challenges become even more critical. Electricity has played a central role in fueling the country’s social and economic development during the last two decades. During the period from 1984 to 1996, power generation capacity increased by an average of 9.5 per cent per annum from 5,848MW in 1984 to 19,142MW in 1996. Thailand’s economy has grown very rapidly and has developed International competitiveness based on an abundance of natural resources, inexpensive labor and a strong local market. Electricity was a key ingredient for assisting the country achieve this economic growth and prosperity. Electrification also enhanced the quality of life. Through electrification, living standards have risen and more social comforts have appeared. Figures from the Provincial Electricity Authority indicate that, presently, as much as 98 per cent of 64,457 villages in Thailand have access to electricity from the national grid. With electricity, people have transformed their lives through increased domestic comforts, industrial competitiveness, job creation and revenues. Even so, electricity consumption per capita in Thailand remains far less than in industrialized societies.

Energy production and consumption, in fact, poses many threats to human health and environmental resources. Thailand’s energy related environmental problems are not confined to power facilities which burn fossil fuels. The legacy of environmental impacts resulting from conventional electricity technologies of thermal power plants and hydropower, although not devastating, still await an environmental clean-up and proper management.

Competing energy sources have their own strengths and weaknesses in terms of environmental and society consequences. No single option ensures total environmental protection. Obtaining massive hydropower required large amounts of land which more often then not was in conflict with land utilization for other purposes, such as agriculture and forest conservation. The displacement of local populations has also been a major, critical issue associated with the creation of large dams and reservoirs. However, from the point of view of sustainable resources, hydropower remains one of the best options. Energy generation by means of thermal power generates wide ranging environmental impacts that are of global, regional, and local concern. The emission of greenhouse gases is creating global consequences leading to climate change and ozone depletion. More regional and local effects are seen in acid rain which damages agricultural flora and fauna, and in air pollution. Other dire effects include land and water contaminated by process wastes.

Electricity: Essential Goods in a New Era of Borderless Power Markets

Energy plays an important role in achieving economic goals or development within a wide range of energy and economic strategies in each country in the region. Some countries promote their economy by importing energy, while others accelerate economic growth by exporting energy. Trade of energy resources in the region is one of the key factors which is beneficial for all the countries involved. However, some conflicts do arise which need to be addressed in this borderless power market.

Following the deregulation of the power sector in 1992, plans to privatize state-owned power utilities has been proceeding and is ongoing. To promote private participation and competition in electricity generation in Thailand, three forms of private participation are emerging. EGAT established subsidiary companies, allowing both small power producers (SPPs) and independent power producers (IPPs) to participate in supplying electricity. National energy policy also encourages power investment and electricity imports from the neighboring countries of Lao PDR, Myanmar and Malaysia. Several agreements have been established with these countries and a number of power projects are in different stages of preparation.

Over a 25 year period, starting from 1998, Thailand will buy almost 95 per cent of the electricity generated by power facilities in Lao PDR. In fact, a memorandum of understanding has been established between Thailand and the Lao PDR by which Thailand will purchase power from and make huge power investments in Lao PDR. Negotiations are currently in the early stages between Thailand and power authorities in Southern China and in Myanmar, where several existing and potential hydropower resources are expected to generate energy for export to Thailand. These new players and new sources of electricity also generate new concerns and issues regarding the rights of local people in relation to natural resources and the environment which are being utilized to support the production of electricity for export to other areas, other countries and other users.

Experience shows that significant structural and ecological consequences are often borne by the local people. Their environment bears a disproportionate share of pollution and destruction. The 900MW Nam Thuen II hydropower project in Lao PDR was delayed for over two years due to environmental issues. Environmentalists and resistance groups voiced their concerns to the World Bank and the Thai government, calling for a reconsideration of the plan to purchase power from this project. The Nam Thuen II dam will flood 450 square kilometers of pristine forest, uprooting and displacing various local tribes from their home in the Nakai Plateau.

Early this year, the Thai government requested my assistance to chair the National Committee attempting to settle the conflict and dispute over the Yandana Gas Pipeline Project from Myanmar to western Thailand. This project was controversial for environmental and political reasons. The primary cause of the vocal resistance to the gas pipeline project was human rights issues in Myanmar and partial placement of the gas pipeline through a reserved forest in western Thailand. Security was another issue. In the context of trans-boundary import and export of electricity and energy resources such as natural gas, the issue is no longer national but has become an International affair. Arguments had been put forth that the country which creates the electricity demand should share the responsibility to ensure the proper power development in the source country, and that environmental safety and social justice should be high priorities.

Through this involvement, I found that predicting environmental impact was no longer the biggest constraint to project implementation. Nor was the design of buffers to protect and heal the environment. Rather, failure to analyze strategic alternatives has been found to be, by far, the most significant constraint in gaining public acceptance. Project justification is not clearly perceived by the local stakeholders. No forceful explanation about why the pipeline right-of-way could not have been rerouted to avoid all conservation natural resources was presented. The project proponent failed to adequately assure the public and the resistance groups that the most environmentally and socially friendly options had been selected.

The Yandana Gas Pipeline episode is a good example of the need for a comprehensive energy sector plan that includes alternative energy policies, plans and strategies or project types, taking into account their costs and benefits, particularly the environmental and social impacts. Analysis of pertinent alternatives will prevent high impact projects from getting on the priority list. After projects are ranked, based on the lowest environmental cost, project specific assessments can be performed. By employing this strategic planning on a sector wide level, the public consultation process at the stage of project specific assessment becomes more manageable with minimal conflict. If stakeholders have participated in the selection of environmental criteria and procedures, short-listed projects, based on the agreed upon criteria, are likely to be widely accepted by civil society.

Electricity Recession: Time to Reassess Energy and Economic Strategies

Today, we gather here in the midst of a regional economic disaster. The Thai energy sector is suffering from falling demand and a market surplus. Costs are rising due to the burden of currency depreciation and unproductive generating capacity. To survive this crisis, the power industry will need to increase internal efficiency through material saving, maintenance and personnel management. I can assure you that an increase in the price of electricity is not the solution. Rather, costs should be reduced and business strategy refocused. At the end of the 1998 fiscal year, electricity demand was down 0.5 per cent from the previous year. Peak power demand slipped by 2.3 per cent to 14,180MW. If the situation continues and there is no further delay in IPP projects, EGAT will reduce the capacity of its power plants by at least 4,800MW in the year 2001. Having suspended purchases of power from neighboring countries, shelved some of its own projects, and delayed commercial operations for most of the IPP and SPP power projects, EGAT anticipates that in 2001, the Authority’s energy reserves will be at a high level of 60.66 per cent of total capacity.

Conventional approaches to energy have focused mainly on increasing energy supply to meet energy demand, but it is now becoming clear that a new approach is needed in order to meet social, economic and environmental objectives. We can turn this economic recession into an opportunity to improve efficiency and increase the profitability of existing power facilities. We can optimize resource utilization, reduce waste and adopt more advanced electric technologies favorable to the environment. The economic crisis aside, long term savings, monetarily and environmentally, could be very real. Much can also be done with extending the life of existing power plants for five years or longer. More efficient, less damaging use of resources can be achieved through initiatives such as the implementation of the Environmental Management System ISO14000. The use of economic instruments, clean technology and pollution control measures still holds great promise. We can pursue a sustainable energy development approach and be optimistic that the economy will regain its momentum in the not too distant future. We will be ready to provide the energy necessary for the recovery process, and we will respond to economic and social aspirations with efficiency and sustainability.

The concept of sustainable development is well known and is now shaping World business and the global economy. The principles of sustainable development promise to be major issues for economic and social policies as we enter the 21^st century. What does sustainable development means for energy? I am certain that most of you in the power industry have great interest in the principle of sustainable energy. Without referring to one specific technology or another, I would like to urge you to continue and even intensify your efforts toward a more energy-efficient future.

The power plants of the next century should be green, a color representing the concept of sustainable energy production and consumption. An environmentally, efficient supply of electricity should incorporate these efforts; 1) maximizing energy efficiency and minimizing losses in the production and transmission of electricity to users; 2) minimizing environmental impacts associated with energy production by using cleaner fuels and applying appropriate management and equipment control; 3) maximizing or possibly replacing the use of fossil fuels with non-fossil and renewable energy resources when technically feasible and economically justifiable.

Demand side management (DSM) must be incorporated into supply options in long term power development plans. In this context, recognition and commendation are in order for Thailand’s DSM efforts, which are regarded as one of eight success stories among 100 projects supported by the Global Environment Facility (GEF). Thailand was the winner of the ASEAN AWARD. Thai DSM efforts officially began in 1993. The measure has been implemented in all energy sectors; residential, commercial and industrial, using various measures and technologies suitable to the region and culture.

Environmentally Friendly Energy Options for the 21^st Century

The electricity industry is at the cross- roads of energy options. We are faced with pressing priorities such as power sector restructuring, energy security and scarce resources, limitations of capital investments and diminishing environmental quality. In arriving at decisions, there must be a real balance, a trade off between energy supply and use, economy and the environment, and social goals. We will survive unfavourable past economic and environmental experiences, and we will not give up our quest for sustainable energy development.

You will agree with me that in order to achieve energy security, it is not appropraite either to exclude altogether any specific energy resources, or to rely excessively on one or the other. However, renewable sources such as hydropower, solar, wind, geothermal and biomass should be used as much as possible through energy technology development and cost reductions. With appropriate policies and new technology, we can anticipate positive global environmental benefits as high as 10 to 20 per cent for fossil fuel replacement. Renewable technologies are beginning to prove on a significant scale, the distinct advantages that make them attractive and cost effective.

At any rate, conventional electricity generation from fossil fuels is expected to continue to supply the bulk of the electricity demand for many years to come. Linked with this, global climate change, is the premier global environmental challenge of the 21^st century. The Kyoto Protocol requirement is unprecedented in the scope of responsibility placed upon both developed and developing countries. It has been recognized as the most complex and important International environmental convention ever signed, both for its global industrial implications and for International relations. Energy policy and options for the next century are now becoming a global matter.

To realize a sustainable society, it is necessary to use all available energy resources effectively and in a proper manner to derive full advantages and to counterbalance disadvantages. First choice resources would be clean, renewable energy such as hydropower, solar, geothermal, wind power and the transformation of industrial and agricultural waste into fuel. Discontinuing the use of fossil-based fuels such as coal, lignite, oil and natural gas for the production of electricity is simply not feasible as fossil fuels still offer economical advantages. However, the sustainable development strategy focuses on increasing the efficiency of combustion technologies and investments in pollution reduction equipment in all cases where there is significant potential for progress.

Another option is nuclear energy, the world’s third largest source of electricity generation after hydropower and coal. Use of nuclear power could have major environmental benefits. Nuclear plants are very compact and have modest land requirements. They do not normally emit carbon dioxide, greenhouse gases, or any other pollutants into the atmosphere. The supply of nuclear fuel is abundant. However, concerns have been expressed about nuclear safety, stemming largely from the accidents at Three Mile Island in 1979 and Chernobyl in 1986. We may, therefore, have to prepare for a critical situation arising in a few decades ahead. We will be forced by the dangers of global warming to drastically reduce the use of fossil fuels and we will have no alternatives in sight. In such circumstances, nuclear fission could be the only alternative for partial alleviation of the situation. This goal, however, cannot be achieved by isolated individual efforts and would require the concerted efforts of the International community. Action to improve the acceptance of nuclear power by the general public or by local communities is essential. The public’s perception of the environmental consequences in this matter is crucial. But the present negative view is subject to change only through proven safety technology and public education. Nuclear power is perceived as extremely dangerous. However, global climate change which is now threatening the survival of mankind is actually being caused largely by burning fossil fuels.

Conclusion

There is no doubt that we have reached the point where energy and the environment are inseparable. All future plans and actions must recognize and integrate this reality. By learning from previous success stories and mistakes, and by having the courage to sincerely forge a more sustainable path, the relationship between energy and the environment will become more compatible.

I believe that electric utilities will continue to have a significant role and responsibility in defining this new relationship as we enter the 21^st century through the reconciliation of short and long term needs of economic growth and efficiency, environmental quality and social well-being. Progress will inevitably include strategies for eco-efficiency, efficiency in both supply and demand, and fossil fuel efficiency for limiting greenhouse gas emissions. Renewable technologies such as hydroelectricity, use of biomass and geothermal power are likely to expand rapidly. Their costs will continue to decline with technological progress and mass production. Furthermore, the door to nuclear energy must be kept open. However, unless the problem of nuclear waste treatment is completely solved, we must recognize that concern will supersede any progress for maximizing the environmental benefits of this alternative.

Throughout the decision-making process, we must not forget that any initiative in the public realm will involve interest from many diverse stakeholders. We must have the courage to acknowledge these voices through the incorporation of a sincere participatory approach to resolving potential conflict. We must educate, communicate and demonstrate leadership in this regard.

Above all, we must strive towards a more sustainable future.

Keynote Address
Environmental Priorities in Southeast Asia

By Anand Panyarachun
International Conference on
Environmental Priorities in Southeast Asian Nations
Shangri-La Hotel, Bangkok
January 10, 1996

Mr. Chairman, Distinguished Guests, Ladies and Gentlemen,

It is a great pleasure for me to address this distinguished gathering. At the outset, I would like to acknowledge the role of the American Bar Association and the Ministry of Science, Technology and Environment of Thailand, in the organisation of this timely conference.

The theme of this conference demands not only our own attention, but also that of the world at large. The scale and pace of economic growth in Southeast Asia are beginning to affect the balance of major global environmental issues. This influence can only increase in the future as development expands and spreads across the entire region.

The leaders of the ASEAN member countries, meeting in Bangkok last December, shared the common vision of a Southeast Asian community by the year 2000. Cooperation on this scale would be a powerful force for sustainable development in the region, and it would also vastly increase the international influence of Southeast Asia. It is therefore of the utmost importance that we establish our priorities for environmental protection now, before, it becomes too late for us to take effective action.

With respect to major global issues, one can think immediately of biodiversity - the variation within and between living organisms and ecosystems. The importance of this region’s biological resources cannot be denied. The inhabitants of Southeast Asia fall into a diversity of racial, religious, social and political systems, yet they are all heavily dependent on direct harvesting from nature.

Most of the Southeast Asian nations are also important storehouses for non-economic biological resources. Although society may not derive any direct economic benefit from such resources, they are essential components of ecosystems and vital for proper ecosystem functioning.

Here in Thailand we are blessed with a wide range of tropical evergreen and monsoon habitats, with a rich large mammal fauna, and valuable marine areas. The statistics are impressive: Thailand harbours about six per cent of all known vascular plants, seven per cent of all known terrestrial vertebrates, and almost ten per cent of all fish. Our neighbours, for example, Indonesia, Malaysia, Vietnam and Myanmar, have equally rich biodiversity resources. These countries are all characterised by a diversity of geographical regions and habitats, with correspondingly high levels of species richness and endemism. The biological endowments of the region have not been bestowed lightly, however. We fully recognise that with them comes the burden of responsibility for sustainable developing and conserving their potential. Our aim should be, in the words of the World Commission on Environment and Development, “to meet the needs of the present, without compromising the ability of future generations to meet their own needs.”

This admirable expression of intent serves as the guiding spirit for our endeavours. Yet it offers us no rules, or guidelines, for accomplishing our objectives. Indeed, it presents us with potentially conflicting aims, the reconciliation of which will no doubt involve much political soul-searching, and perhaps many compromises.

To illustrate my point, I would like to turn to another global environmental concern; that of climate change.

In November of last year, the Inter-governmental Panel on Climate Change (IPCC) released its Second Assessment Report on the status of global climate change and the influence of human activities. The Report provided conclusive proof those human activities, and industrial activities in particular, are contributing to the increases in global temperatures that have been observed over the past century.

In the absence of effective mitigation policies, the continued acceleration of “the greenhouse effect” is expected to result in further temperature increases, as well as fluctuations in the intensity and distribution of rainfall, and rises in sea level. The consequences for our society could be potentially catastrophic. The IPCC’s Report foresaw losses of biological and land resources, with adverse consequences for health and food security in some of the most vulnerable regions of the world.

These effects would combine to threaten and undermine sustainable economic and human development.

As subscribers to the precautionary principle, the nations of Southeast Asia and the rest of the world have placed their faith in the United Nations Framework Convention on Climate Change (UNFCCC) as a forum for tackling global environmental change. In the three and a half years since the Convention was signed, we have progressed from debate to negotiation and, in the wake of the first Conference of the Parties last year, to partial agreement and action.

But are we doing enough? Can we claim to be taking the necessary steps to halt the continued deterioration of the Earth’s climatic system?

Regrettably, I am not sure that we can. My doubts are based on the way in which the international community has assigned its priorities. I have argued before that the nations of Southeast Asia must avoid reiterating the development patterns of the industrialised West, both to prevent intense local pollution, and to avoid becoming producers of global pollution on a scale in direct proportion to their human numbers. Yet, given the justifiable importance we have placed on economic development, it is inevitable that our present levels of resource consumption will increase.

The challenge for us, therefore, is to moderate the rate of this increase. The challenge for the industrialised nations, on the other hand, is to reduce consumption and pollution to offset inescapable increases in developing regions. Our common goal should be to create a new, equitable balance in the global economy; one which will prevent catastropic disruptions of our climatic and biotic systems, while at the same time allowing sustainable economic and human development to continue.

Yet there appear to be significant differences between this aim and the priorities of both industrialised and developing countries as seen today. The ultimate objective of the Climate Change Convention is the “stabilisation of greenhouse gas concentrations…at a level that would prevent dangerous…interference with the climate system”. While this aim currently involves no legally binding commitments, the action that has been taken so far is not fully in the spirit of the Convention. Industralised countries are only nominally committed to reducing emissions of greenhouse gases to 1990-levels, while other Parties to the Convention have simply to produce an inventory of greenhouse gas sinks and sources.

Clearly more action is needed on climate change, and needed soon if we are to achieve a global balance within a realistic time-frame. One potential avenue opened at the first Climate Convention Conference in Berlin last year was international cooperation to reduce emissions, otherwise known as “Joint implementation”. Joint implementation provides cost-effective opportunities for reducing or sequestering greenhouse gas emissions across international boundaries. Most importantly, joint implementation could promote technology and information transfers between countries, and therein lies its real promise.

By promoting the redistribution of technologies designed to reduce our dependence on natural resources, joint implementation could improve our chances of preventing more serious environmental damage. Moreover, the transfer of modern technologies to developing countries, provided those technologies were suited to local conditions, could promote sustainable economic development.

Clearly technological cooperation, whether under the Climate Convention, the Biodiversity Convention, or any other international agreement, is an important priority. Under such a regime, the new global balance of which I spoke earlier becomes a more realistic and attainable goal. Indeed, our progress towards environmentally-sustainable regimes of cooperation has already been considerably furthered by the development of ISO 14000 environmental management standards.

I would like to discuss ISO 14000 in greater depth because to me it represents an important priority in both global and national terms.

The emerging set of ISO 14000 standards is one of the most comprehensive environmental quality management initiatives ever undertaken. Once adopted, this standard is expected to become the benchmark of environmental quality for all future international trade. Achievement of this goal will involve implementation of environmental management systems (EMS), environmental audits, environmental performance evaluations, product life-cycle assessments, and product labeling.

The ISO 14000 series of standards emerged primarily as a result of two major events: the Uruguay round of the GATT negotiations which began in 1986 and the Rio Conference on Environment and Development held in 1992. The GATT talks addressed the need to avoid or remove non-tariff barriers to trade, while the Rio ‘Earth Summit’ established an international commitment to protection of the global environment.

With careful implementation, the ISO standards should prove capable of uniting both trade and environmental concerns. If the international community can succeed, as I believe it must, in avoiding non-tariff trade barriers, while honouring its environmental commitments, the ISO standards will represent a new position of consensus for business and the environmental community. With the potential to promote world trade, whilst at the same time encouraging and assisting industries and other organizations to be more environmentally responsible, the standards should allow economic development, but not at the expense of a degraded environment.

In the work of the ISO, we have an important link between common global priorities and our own regional and national priorities. The private sector in Southeast Asia is rapidly becoming a major environmental influence through its financial resources and its export drive. Through education and promotion of the ISO 14000 standards, as well as the earlier ISO 9000 series, the environmental community is beginning to build partnerships with the private sector. These partnerships are proving invaluable in the process of tapping the potential of the private sector as a force for environmental improvement.

Here in Thailand, the Thailand Environment Institute (TEI) is investigating ways of garnering private sector support for a national environmental foundation or trust. Already working closely with members of the Thailand Business Council for Sustainable Development (TBCSD) on the ISO 14000 series, TEI is now studying the role that a national fund could play in leading the private sector down the path of sustainability by using its capital to create ventures that both realise a profit and use resources in a responsible way.

Mobilising additional resources in this fashion represents a crucial priority if we are to finance not only the immediate costs of environmental protection, but also the recurring costs. Furthermore, the partnerships that are formed in this way draw a wider range of players into the environmental arena, and meaningful participation is enhanced. The success of a national fund will be in direct proportion to the number of constituencies it addresses. With representation from the private sector, government, non-governmental organisations and people’s groups, a collective effort to improve national environmental quality would have a strong chance of succeeding.

I have touched on the issue of public participation, and would like to develop this further with respect to our urban environments. It is undeniable that one of the least desirable side-effects of rapid economic development in Southeast Asia has been the emergence of vast, largely unplanned, urban conurbations. The haphazard nature of urban development in cities such as Bangkok, Manila or Jakarta is contributing to worsening traffic chaos, air and water pollution, and a general reduction in the quality of life.

Coupled with these negative trends is a rapidly growing sense of frustration amongst the urban population, who feel that they have little control over their environment, and must suffer without recompense the adverse effects of rapid economic growth and development.

Environmental management in the urban areas of Southeast Asia has almost always been the responsibility of governments, both central and local. In 1992, my administration undertook a wide-ranging revision of environmental legislation intended to lead towards sustainable development in Thailand. The National Environmental Quality Act, as the centrepiece of this legislation is known, now provides us with the tools of environmental management, and the power needed to wield them effectively.

For urban dwellers, the benefits of these changes have already become apparent. For example, unleaded gasoline was first imported into the domestic market in 1992. Rapid acceptance of the new fuel led to competition between local refineries to produce unleaded formulae. At the beginning of this year, the spread of unleaded fuel culminated in a complete phase-out of all leaded gasoline. As a result of these developments, the level of airborne lead pollution has dropped dramatically in Bangkok.

However, as urbanisation has increased, and environmental problems multiplied, safeguarding the environment has become an almost overwhelming task. Here in Thailand, privatisation and sub-contracting have recently been initiated by several government agencies in an effort to alleviate the burden. However, another potential option is to encourage individual communities to protect and manage their own immediate environments.

There is a growing awareness of environmental issues amongst the people of Southeast Asia, and urban dwellers in particular. The responsibility for this can be attributed largely to the mass media, who time and time again have demonstrated their commitment to environmental values. It seems that almost every environmental crusade can trace its origins to an article in the newspapers, or story on television.

Now surely is the time to give the people of Southeast Asia some say in the future of their environment, and to recognise the role of the media as a force for education and enlightenment. By empowering local populations we can accomplish several things. Firstly, the ability of local people to manage their environment will be enhanced. Secondly, a sense of community can be instilled in often-disparate urban groupings. Thirdly, an on-going dialogue can be created between government authorities and local communities, which will help to strengthen trust and cooperation. Finally, and perhaps most importantly, truly sustainable development can be achieved because it is based on consensus, and has the legitimacy that only consensus can confer.

Up to now, I have been considering priorities for the development and protection of our natural environment and its resources. I cannot help thinking, however, that we risk neglecting one of the most important elements of the human experience; namely, our culture.

I firmly believe that when we talk of environmental priorities we should include our cultural environment and particularly the material remnants of our history which do so much to convey and foster national identity. Southeast Asia is a region of great antiquity, and the treasures of the past such as Ayutthaya and Sukothai here in Thailand, Angkor Wat in Cambodia, and Borobudur in Indonesia, still have the power to enrich our lives tremendously.

It is regrettable; however, that the levels of attention, interest and even funding are far lower for cultural protection then they are for other developmental issues. Development and conservation plans for our natural and cultural heritage progress in different directions and are no longer mutually sustaining or even inter-related.

In recognition of the relationship between society, nature and culture, the Thailand Business Council for Sustainable Development (TBCSD) has been sponsoring the preservation and development of the island city of Ayutthaya, one of Thailand’s most important historic sites.

Founded in the mid-14^th century, Ayutthaya was for over 400 years the capital of a flourishing and prosperous kingdom situated in the Chao Phraya River basin. In recognition of its historical significance, Ayutthaya was designated a UNESCO World Heritage Site in 1991. Restoration work under a master plan prepared by the Fine Arts Department of the Ministry of Education began last year.

The TBCSD has been active in promoting the implementation of the Ayuttaya master plan, which seeks to meld environmental, cultural and social considerations into a cohesive whole. We recognise that success will depend on all groups in the government, private sector, academia, non-governmental organisations, as well as the local community, lending their support to the initiative. To this end, an on-going process of consensus-building and open dialogue has been initiated.

I hope I have demonstrated that the assignment of environmental priorities must start from a full understanding of those elements, which comprise our environment. To all, consideration of the natural environment must be added that of our social and cultural environments. Once we have taken this holistic approach, we will be in a stronger position to identify those factors, such as public participation, which cross over boundaries and are therefore of the greatest importance.

The nations of Southeast Asia are perhaps best placed to realise this approach towards environmental protection. We are now at the stage where the benefits of economic growth can allow us to conserve and sustainable development our still abundant natural resources. National governments are introducing environmental legislation based not on command and control measures, but on market-based instruments. Our people are becoming more informed and aware of environmental values and the need for effective protective measures. Moreover, they have the potential to make their own real contribution to environmental management. The potent force that is the mass media can serve us well as our environmental watchdog. All these factors inspire me to think that Southeast Asia can, and will, be a model for truly sustainable economic development.

SUSTAINABLE DEVELOPMENT: THE SOUTHERN VIEW

By Anand Panyarachun
International Management Symposium
St. Gallen University, Switzerland
May 22,1995

I would like today to offer you a view of the concept of sustainable development from the less-industrialised, less-developed part of the globe. This area is often called the ”Third World”, but the phase shall doubtless disappear now that the industrialised nations are no longer split between-to uses the old shorthand – capitalist and communist . How can there be a Third World, when there are no longer First and Second Worlds? The Third World is also a more heterogenous place than ever before; indeed, some countries in Asia and Latin America are more “developed”, in terms of most indicators of human progress, than many newly emerged nations in Central and Eastern Europe.

Let us instead use, again as shorthand, the benign terms of North and South, even though most of the more populous developing countries lie north of the Equator.

The North has developed, and continues to thrive, through easy access to affordable resources. In Europe’s case, a great deal of resource-based wealth came from the colonies. Societies aspiring to a similar prosperity see resource utilisation as their first priority. Yet the South already contains some four-fifths of the world’s population, and is expected to be the scene of over 90 per cent of future population growth. Obviously, if the south were simply to extrapolate past levels of resource use to meet present reasonable ambitions and future population growth, this would be extremely unsustainable. Increased fossil fuel use is one of the most obvious and oft-discussed dangers. It is hard to imagine a stable and predicatable global climate if the populations of China, India, Bangladesh and Indonesia begin burning fossil fuels at the same rates as North Americans.

In the past, the North used resources for economic development whilst degrading its environment locally through air and water pollution - hence Blake’s famous image of “dark satanic mills”. But with economic development came the economic power to clean up. Also, there came a progression from dirty, old manufacturing industries to both cleaner factories and cleaner forms of economic development, such as services and information industries.

Yet the North has now moved from local pollution to global pollution, and has been responsible for the greatest releases of greenhouse gases and ozone-depleting gases. Occasionally, although less and less of late, the North has actually tried to get rid of its rubbish, both nuclear and toxic, by shipping it South.

The South most avoid the old northern development pattern for two different reasons. Firstly, it cannot afford to go through a period of intense local pollution. During the Victorian era, the English were willing to put up with rivers that stank, air that killed, and pollution that turned whole regions black. But 21^st century Thais will not accept such “progress”. Secondly, we cannot-for the globe’s sake-become a producer of global pollution on a scale in proportion to our numbers.

Yet, given the importance of resource utilisation for development, it is inevitable that the South will have to increase its level of resource use. The challenge for the South, therefore, will be to moderate the rate of this increase. For example, Thailand is doing its utmost to conserve energy resources through a major Demand Side Management program. By improving energy efficiency, Thailand’s industrial and commercial sectors are being provided with much-needed energy at a fraction of the cost of adding new generating capacity.

So, when we speak of “growing constraints on resource use”, we must be clear that we are not talking about the South’s cutting right back. We are talking instead about creating a new balance between North and South in the quantity and quality of natural resources each uses. The North will have to cut back to offset inescapable increases in the South, whilst the South will have to find ways and means of containing these increases within reasonable bounds.

But, for both, resource use must be more respecting of environmental criteria at all stages – extraction, processing, use and disposal. Only if these criteria are met throughout the cycle can such resource use really be made sustainable over the long term.

Advances in techniques of exploration and exploitation are continually increasing the resources available for our use. But using these techniques indiscriminately can lead to ruin – both environmental and economic. The recent collapse of some major fisheries and the near–collapse of others offer good examples of how the desire for economic increase can overcome both scientific knowledge and common sense. Fisheries scientists warned repeatedly that too many boats using the most modern fish-finding gear, and catching smaller and smaller fish, would lead to virtually no boats catching no fish. Neither fishermen nor governments listened.

In theory, the “free market” should prevent such resource collapses. Scarcity is supposed to lead to price rises that decrease the number of consumers until a sort of “supply-and-demand sustainability” is reached. In practice, there are several reasons why this may not work. The resource is depleted more quickly than the market can react. There is not enough, or there is the wrong sort information driving the markets. For example, governments of both North and south often subsidies the use of precious or potentially harmful resources, thus encouraging their over-use or misuse. I am thinking of the subsidies in various nations on the uses of petrol, coal, water, fertiliser and electricity.

Instead of subsidising, we should be using various economic instruments – such as pollution taxes and charges – to ensure that prices reflect total costs, including environmental costs. This is known as “internalising costs; for example, putting into the cost of driving a car the cost of treating the childhood asthma apparently caused by the exhaust fumes.

You can easily see that “internalising costs” almost always means rising prices. This is hard enough to do in the wealthier North. How much harder then would it be to charge the “real price” for water, timber and energy in the South where the economic development of a nation is often a life-or-death issue for individuals.

Thus in the South, the transition away from resource-intensive economic development – the Northern approach – must take place before market forces indicate resource scarcity by price signals. Transition to a more sustainable, less resource-intensive pattern of development must thus involve more use of government policy than in the North.

This will be difficult for governments, because sustainable development appears over the short term – the term over which all governments operate – to be the most expensive option. Governments think from election to election, while sustainable development makes sense only from generation to generation. This explains why governments have so much difficulty with the whole concept. It gives them the impossible choice between choice between being publicly in favour of unsustainable development, or of following policies that may keep them from being re-elected next time around.

To follow sustainable pathways, the South is going to need help from the North. Amongst that help should be some good examples to show that the North itself is serious about sustainable development. We shall not be impressed by sermons on sustainability unless the North adopts the religion it preaches.

How often have you heard someone in the North argue that we must protect the rainforests of the South because they and the species they harbour are “the common heritage of mankind”? But how often have you heard of a northern government offering a realistic sum of money to help pay the people of a rainforest country the opportunity costs of not developing those forest areas? This has rarely, if ever, happened. The real message to be: “it is our common heritage, you pay the costs of protection”.

It is appropriate that the consumption patterns of the North are now becoming and international issue. But this issue provides logical difficulties for the South. On the one hand, we do not want to discourage the North from buying a lot of the sugar, leather, timber, oil and other resources that we produce. On the other hand, a small planet cannot long survive a system in which a fifth of the population consume four-fifths of the resources. Northerners still tend to seek convenience, comfort and wealth over living within planetary means. Frugality in resource use is not yet viewed as a virtue.

Furthermore, technology is coming to be seen as a panacea, something that will save us from our spendthrift ways – rather than as a set of tools which will save us only if used with the greatest skill and foresight.

So the North must realise that whilst it may be “developed” in terms of industry and infrastructure, it is not necessarily sustainable in terms of global pollution or over-use of resources such as water and topsoil. To be fair, however, the North is making progress. The European Union has adopted sustainability as a criterion for policy at the highest level. In response, many Northern governments are now consciously moving towards a strategy relying on the application of information and information-based tools, plant and equipment, to enhance the efficient use of resources, or even to substitute for resource use altogether. But this progress makes it all the more evident that only the richer, more technologically-advanced countries have a capabilities to follow such a course through. These are the countries of OECD, plus the Newly-Industrialised Economies of Southeast Asia. For the rest, the advent of an information-based society must await substantial conventional development.

Thus, another sort of help we shall require is cooperation on those technologies described above that will allow our businesses to become more “Eco-efficient”. This is a term the Business Council for Sustainable Development coined for the Earth Summit in Rio de Janeiro in 1992. Eco-efficiency refers to a type of efficiency whereby companies add ever more value, using ever less resources and releasing decreasing amounts of pollutants. We do not want gifts or old-fashioned ”foreign-aid”. We do want innovative investment thinking that brings together companies, government agencies and perhaps the World Bank and regional development banks to encourage the introduction and dissemination of new, resource-efficient technologies. One mechanism which may facilitate this process is Joint Implementation, which represents a way in which countries can fulfill their commitments under the UN Framework Convention on Climate Change. By promoting technology and information transfers to reduce greenhouse gas emissions, Joint Implementation appears to hold real promise for disseminating Eco-efficient technologies.

In one sense, the spread of resource-efficient technologies is happening automatically. As markets become more global, competition becomes more global. To compete successfully, Southern companies must modernise, and more modern production equipment is almost always more Eco-efficient. But we need to speed up this process.

The issue of “Technology transfer” was very controversial at Rio, and remains controversial today. In the South there are far too many unprofitable, unproductive steel mills, aluminium smelters and oil refineries “transferred” by the process of development aid. We argued in Changing Course, the book produced by the Business Council for the Earth Summit, that technology is best moved through a process of “ technology cooperation” between businesses, which includes training, communications and technology development. When Business is involved, you can be sure that the technology is wanted and will be used - which is not always the case in “aid” projects. Especially when the aid is tied to the purchase of a certain country’s goods. Tied aid tends to move technology unwanted in the North to those in the South who does not want it either.

Even so, the South remains hampered by the fact that most Eco-efficient technologies which are helping the North attain a more sustainable economic system were developed and designed specifically to meet northern requirements. There is an urgent need for Southern-specific technologies and applications. For this, besides greater effort in technology cooperation and adaptation, human resource development becomes vital. Only when the South has at its disposal a trained cadre of men and women able to integrate the new technologies with the need and potential of the South, and to research new ways of tackling local problems, will a truly sustainable, and truly endogeneous, solution be found.

Why should the North be at all interested in helping the South towards sustainable development? Has not the age of international charity ended and the age of international competition begun?

The most compelling answer the question of “why?” may be that it is in the survival interests of the North to offer such help. Few have noticed it, but there has been a major shift recently in the issue of international security. There was a time when the poorer nations of the world offered absolutely no threat to the security of richer, better-armed nations. The spectres of global warming and ozone depletion change this. If the populous Southern nations follow a carbon-based development part, they will disrupt the climatic systems that drive the agriculture of the United States and Europe. Rising seas may eventually destroy major port cities, for example Venice. Such damage would be as physical and as costly as any military damage.

Another reason for the North to help is that the unsustainable development of the South is primarily a long-term global problem. In the past, the North massively overburdened the Earth’s carrying capacity, and now has prior responsibility for the fragile state of the world. Its continuing role as originator of the technologies and practices which place such pressure on global systems means that it is only equitable if some of these fruits of past and present exploitation were to be shared.

We are not asking for a “redistribution of wealth” – even a massive shift of resources would not provide a long term solution. No, the only real solution must be one based on a redistribution of the ability to create wealth. This involves the creation of new, fairer trade regimes and technology cooperation regimes based on the mutual understanding that the South is entering the game with the odds stacked against it. If there is a price for sustainability, it must be paid principally by the North - for reasons that have to do with both practicality and the fair play.

Important move in this direction has been made by developing ISO 14000 environmental management standards. By standardising international management tools and environmental systems, ISO 14000 is attempting to minimise trade barriers and thus promote technological cooperation.

However, we must be particularly careful not to move in the opposite direction: towards a growing gap between North and South. There were times at the Earth Summit when it appeared that the old East-West split had simply been rotated 90 degrees to become a North-South split.

Two processes could exacerbate this split. The first might be a selfish technological revolution in the North which bypasses the South. It is often claimed that we are on the brink of a new Information Revolution, surpassing in its effects both the Agricultural and Industrial Revolutions, in which information will replace capital as the driving force in human affairs. If this is the case, then information and the ability to manage that information must be spread Southwards. Otherwise, the two halves of the globe will simply not be able to communicate.

A second North-South splitting process would be any move on the part of the North to “punish” the South for perceived environmental crimes. Such punishment might take the form of trade barriers. Economic development in the South is not about increased GNPs. It is about alleviating hunger and saving the lives of the millions of children now dying each year from contaminated water. We can change our approaches to development, but we cannot forego development because the North thinks we should. As I have noted, we expect the sacrifices to come from the other direction - from the North.

Some of what I have had to say may seem pessimistic, or antagonistic, or both. I am in fact a cautious optimist. We have the technology, both in terms of Eco-efficient production and in terms of the communications we need, to develop the necessary partnerships for sustainable progress. Through partnership, those who benefit from economic growth can also be rendered more responsible for the way that growth is generated. With greater public awareness of the costs and penalties of unsustainable pathways to growth, improvement in the quality of life for the South’s citizens need not always be at the expense of the environment.

Merging Business and Environment -
Three Steps to Leadership

by Mr. Anand Punyarachun
Chairman, Business Council for Sustainable Development (BCSD)
Chairman, Thailand Business Council for Sustainable Development (TBCSD)
Asia Pacific 94: Merging Business and the Environment
The Regent Hotel, Bangkok
7-8 December 1994

Mr. Chairman, Distinguished guests, Ladies and Gentlemen,

It is a great pleasure to be among so distinguished a gathering, at such an important conference. My sincere thanks go to the International Herald Tribune and to the Thailand Environment Institute for making it possible.

I remember very well the previous conference they organized on “Merging Business and the Environment” in January 1992. That was less than six months before the Earth Summit – when the world’s attention was beginning to focus strongly on Rio, and when there was a growing sense of expectation, not least among ordinary men and women, about what would emerge from that great event.

This conference is being held in very different circumstances. Most major economies have experienced serious difficulties since then, and even now, some have still not fully recovered. This has had two consequences.

One, the environment has not been as prominent on the agenda as we hoped it would be following Rio. Two, the expectations raised during the run-up to Rio, and especially at the conference itself, have not been fulfilled to the extent we believed they would.

This is a great pity – and it is urgent now that we act to ensure it does not become a tragedy.

To my mind, the real success of Rio was in forging a broad consensus in support of change – in some areas, radical change towards sustainable development. And it marked a particular milestone in drawing business into a process which hitherto had been driven mainly by government and environmentalists.

Through organizations such as the Business Council for Sustainable Development, business participated actively in the preparations for Rio, in the conference itself, and in fashioning the post-conference action agenda agreed there. Crucially, Rio recognized that the private sector had a major part to play in implementing that agenda.

In short, we can be encouraged that business as a whole has begun to develop new attitudes and approaches – just as governments around the world have begun to explore new strategies and policies to implement that agenda.

Yet, there is a sense of disappointment at what has actually been achieved during the past two and a half years – and I personally share this. In Rio, the baton was passed from the NGOs to the politicians. As a former Prime Minister of my country, I know how difficult it can be to effect change: and I well understand how the fierce winds of recession in the West pushed governments off course.

Even so, progress on the political front has generally been slow.

For example, it is hard to detect a real sense of urgency by governments on fulfilling their commitment to accelerate the process of internalizing environmental costs into market prices. Tackling the problem of subsidies also have replaced common sense and business sense.

One impediment to change is the political process itself – the procedures for decision-making in the current administrative structure are simply not up to the task. We need to reinvent government.

We also, let me add, need to reinvent the international institutions. The United Nations, the World Bank, regional development banks all ought to be the primary agents for change towards sustainable development. But while some have started to come to grips with what their role should be, their structures and systems weigh against them. There is clearly something amiss for instance when by some estimates, the World Bank now loans 20 times as much for the production of energy as it does for energy conservation.

It would be unfair to suggest there is a political vacuum. Yet in my view, the baton is not being moved forward at the political level as rapidly or with the sense of urgency that is clearly needed.

I believe therefore, it is time now for business to seize that baton, and lead the race towards sustainable development. I feel confident this will be welcomed. Indeed, I judge there are growing public and political expectations of business to take the initiative.

What I would like to do in these brief remarks is identify three concrete and key steps which business can, and should take to demonstrate a new level of leadership on the environment.

The first is accounting for environmental costs

Sustainable development is a vision of economic activity that effectively manages the Earth’s resources for sustained, equitable growth worldwide. This vision can best be realized through market economies and economic incentives.

That is why it is imperative that governments move rapidly internalize environmental costs, preferably through economic instruments. This will make producers pay the costs of using the environment. It will spur companies to find new technologies, new processes, even new products to use raw materials and energy more efficiently, and reduce – ultimately eliminate – pollution. It will drive them to become eco-efficient.

But business does not have to wait for government to act. It can already move some way in that direction through a two-stage strategy.

The first phase is to quantify and allocate existing environmental costs: to measure the costs associated with product, production processes and their related waste streams to find out the true costs of the products or services they currently deliver to the market.

Some companies are doing this – Ontario Hydro led by Mr. Maurice Strong is one. Most are not. It is time that accounting for environmental costs becomes the norm in business, with those companies experienced in internal environmental accounting sharing their knowledge with others. I believe, too, that various industry sectors should begin to develop eco-efficiency criteria and indicators.

The second phase of the strategy is for companies to recognize and incorporate future anticipated environmental costs connected with their operations. The key to this is a life-cycle approach to the entire chain of production from natural resources to disposal. Again, some companies are beginning to internalize these kinds of costs. It is time now for all companies to start capturing environmental costs they do not presently include.

The second area where business can demonstrate true leadership is on environmental reporting.

The Agenda 21-action program, approved in Rio, says that companies should be encouraged to “report annually on their environmental records, as well as on their use of energy and natural resources.”

In Changing Course, its report to the Earth Summit, the BCSD said that “a vision and implementation strategy for sustainable development is most useful if the resultant actions can be reported, offering chances for feedback and improvement. Companies need to issue regular reports to their stakeholders on their progress toward sustainable development.”

At the time that the report was written – nearly three years ago – a survey of business in more than 30 countries found that most companies did not provide public information on their environmental or sustainable development policies or activities.

Today, an increasing number of major companies produce annual environmental reports, charting their progress in such grey areas as emissions, waste management and resource use. Some of them – from Dow. Du Pont, Norsk Hydro, Ontario Hydro to name a few examples – are excellent, not least because they show, with commendable transparency, those companies’ shortcomings, as well as successes.

Yet the disappointing fact is that most companies – indeed, the overwhelming majority – still do not issue environmental reports, and many even fail to disclose such information in their corporate annual reports – and most companies have no plans to do so.

Their explanations are many and varied. It will cost too much to audit their operations. There is actually no pressure on them to report on their performance. If they do report, they will bring unnecessary and unwelcome scrutiny to their company activities. If they admit to problems with emissions and waste management, they will be accused as polluters.

Frankly, I am unpersuaded by these arguments. In my view, when a company uses environmental resources, it should report – to its shareholders, employees, customers, and to the public – on how it is using them. As Norsk Hydro stated in its 1993 annual report: “Industrial activity is followed critically by a concerned public. Much of the public distrust is caused by industry’s own lack of openness.”

Those companies which do report believe that the benchmarking of corporate environmental performance will emerge as a high priority issue. I believe they are right. And I agree with those corporate leaders who foresee the corporate “responsibility” agenda of the 1970s and1980s evolving into a more demanding “accountability” and eventually “sustainability” agenda.

Therefore, it is time for all companies to include environmental reporting as a matter of course in their overall reporting procedures, so that their shareholders can judge their performance on such critical areas as material use, energy consumption, air and water emissions, packaging waste, waste management/disposal, and product impact.

The third area – closely linked to the question of environmental reporting – is the fixing and announcing of clear, measurable goals for environmental performance.

In Changing Course, the Business Council stated: “The basis for reporting is goals. Operational policies need to lay down corporate objectives and standards in ways that can be measured, for as the business adage has it, “What gets measured, gets done.”

The report added: “A decision to act without commitment to measurement is hollow.”

Some companies have publicly set clear and measurable targets. They include, to name some

AT&T – which has committed itself to reduce reportable toxic air emissions by 95% by the end of 1995.

S.C. Johnson and Son, Inc. – which has pledged to reduce its air emissions, water effluents and solid waste disposal in the company’s manufacturing operations by 50% as a ratio to total production by the end of 1995.

Du Pont – which has set out a series of specific environmental objectives, including reducing or eliminating dangerous air emissions, hazardous waste, packaging waste within clearly laid out timescales.

These, and other companies, are – to use another expression – prepared to “stand up and be counted.” They are willing to be judged by failure as much as by success. It is these companies which are today’s leaders in merging business and the environment.

But they remain the exception, not the rule in business. Too often, companies confine their environmental commitment – that is, where they acknowledge the need for such a commitment – to a well-written mission statement that reads well, but says little of substance because it is long on generalities, while conspicuously absent of hard-edged specifics.

Those companies believe this is enough to “get them off the hook”. In my judgement, they are unwise to believe so. Hiding environmental performance behind fine-sounding words – worse, substituting bland phrases for actual performance – is no longer an option. The public and politicians expect more. And business must provide much more.

I am rather pleased to note that in Thailand, the Thailand Business Council for Sustainable Development has begun taking up the challenge. Though it was only established in October last year, it has moved rapidly to promulgate its own 10 points business agenda for sustainable development on which its members now subscribe.

As of June this year, an implementation plan is now in place for members to establish their own corporate environmental policies, initiate environmental activities, carry out self audits and to eventually publish environmental reports to the community and the public. From these initiatives, I foresee that in the next few years, I could be at liberty to mention some convincing examples of how Thai business is demonstrating the new level of environmental leadership that I have just mentioned. This I can say because I am witnessing this trend now being demonstrated by some companies such as:

• The Siam Cement Company, Ltd. Is showing its social responsibility by establishing its own Environmental Standards Coordinating Committee that overseas the implementation and dissemination of information about their environmental policies to the public.

• Volvo (Thailand) Co. is one among the many subsidiaries of the parent company to apply green thinking in all its operations. It has spent 10-15 million baht over the last 5 years reducing its carbon monoxide emissions as well as cutting its solvent use by 30%.

• Esso Standard Thailand Ltd. Also takes care to address environmental needs of the communities in which it operates. It has upgraded its response capability by investing 100 million baht over the last 3 years for oil spill equipment and founded the Oil Industry Environmental Safety Group, an organization set up to share resources in the event of a major oil spill.

• Saha-Union Public Company, together with its business partner, have invested more than 100 million Baht in the first half of 1993 on ultra-purified water cleaning process for electronic components, thereby eliminating the use of ozone-depleting substances or CFC’s (chlorofluoro-carbons) from its manufacturing plant in Chonburi.

• Lever Brothers (Thailand) Limited has invested 300 million Baht in a new plant to make naturally derived ingredients, a further 150 million Baht in a facility to make powders by a process which uses no waste, 80% less energy and produces no emissions. They have also installed automated pollution control systems in their factory. In addition, Lever is responsible for a 50 million Baht scheme to plant 1 million trees in Thailand over the next 2 years.

I believe that every company CEO should now feel it is incumbent for his company to announce specific commitments on what it intends to do to:

• achieve substantive energy efficiency improvements within their organizations

• reduce emissions of pollutants into the air

• cut discharges of polluting effluents into seas, rivers and other water sources

• increase the recycling of paper, cardboard, plastic, glass and other materials in manufacturing and/or office facilities

• minimize the environmental impact of their products

In other words, business should, across the board, commit to clear, measurable targets for a range of key, urgent and specific environmental performance actions within specific timeframes.

I have tried to set out a new three-point agenda for international business to implement to set us back on the course agreed in Rio: an agenda which would enable business to demonstrate:

• positive action on environmental costs – through environmental cost accounting

• true accountability of their use of environmental resources – through full environmental reporting

• real commitment to environmental performance – through setting, clear, specific and measurable goals

It can be done. The best companies – those I have mentioned, and others – are doing it already. And while of course, it presents a challenge – a tough one for many companies – leadership is about accepting tough challenges.

The problem is that business is like a convoy – and even when it is heading as one in the same direction, the speed is usually dictated by the speed of the slowest members. It may take a combination of peer pressure and public pressure to convince the rest to hurry up. But hurry up they must.

For there is a leadership role waiting to be filled in moving the post Rio agenda on sustainable development forward, further and faster. If business can assure the politicians and the public that it is serious about merging its agenda with the environmental agenda, business will show its leadership credentials. Such a leadership role is waiting to be filled. It is essential it is filled.

Governments have been distracted, and have yet to convince us that they will re-engage with the same vigor and commitment they showed in Rio. There is therefore, an expectation of business to assume the responsibility.

It is obvious that fundamental change is needed. We have two choices – to resist, or join those shaping the future. I believe that in the end, it will be impossible to resist. Therefore, I am inviting – indeed challenging – all my colleagues in business to participate. It is the most rewarding option, and the right one.

Keynote Address on
Business and Environment Challenges Ahead

by Mr. Anand Panyarachun
Chairman, Business Council for Sustainable Development
Chairman, Council of Trustees Thailand Environment Institute
At the Environment Seminar and Exhibition
Organised by the British Embassy
MOSTE, Thailand Environment Institute, Chulalongkorn University
Regent Hotel

October 17, 1994

Your Royal Highness, distinguished guests, ladies and gentlemen, it is my honour today to welcome you to Bangkok and to participate in “Britain in Thailand” week.

It is indeed a pleasure to welcome such a gathering of British businessmen and experts working in the fields of environment, water management, and health to our Capital City.

The sponsors of this week are undertaking a commendable task in expanding our knowledge of topics which are of obvious and increasing importance for Thailand and the other rapidly industrializing economies of Asia.

As a former student of Cambridge University, I was privileged to gain a clear insight into the educational traditions and strengths in British which have fostered the expertise and technical excellence we see exhibited by many of the British companies taking part in this event.

I wish you well in the week ahead and firmly believe there continues to be great scope for Thai and British companies to work together and to learn from each other in these vital areas.

Economic Dynamism and Environmental Costs

Businessmen visiting Bangkok, and any of the major centres of the region, can easily see and feel the dynamism of the processes of industrialisation and urbanisation at work in this vibrant part of Asia.

The power of the market forces present in Thailand are tangible; the raw energy and entrepreneurial drive underpinning the economy are obvious.

For Thailand and our regional neighbours, significant periods of economic stability combined with openness to foreign investment and an increasing emphasis on investment in people, have combined with the entrepreneurial flair of many talented individuals, to create a situation where at current growth rates, grouped together, the economies of the region coupled with that of China could become as large as Western Europe by 2005.

It is fair to say the markets have treated us well from an economic standpoint and now we must ensure they work equally well for our environment.

Across business and industry in Thailand, awareness is growing that our ability to compete in fast changing International markets is prerequisite for continued prosperity. If we are to maintain the impressive progress of recent years, we will have to maintain strong export growth, to develop new markets, and to adjust to challenges emerging as the forces of Internationalisation take hold.

During the past 20 years, we have seen labour and resource intensive development unleash powerful forces of industrilisation, allowing us to further explore, develop and feed export markets in Europe, North America, Japan and other trading partners with our products and raw materials.

Those forces have sometimes proceeded at break-neck pace. It is an unfortunate truth that the downsides of, at times, explosive growth and industrialisation are also obvious in our cities and manufacturing centres.

Intense traffic congestion, deteriorating air quality, and widespread water pollution are an everyday reality, which are exacting an incalculable cost in terms of productive time lost, health, quality of life, and the natural environment.

Trade and the Environment: A Challenge for Thailand

A complex set of new challenges for Thailand comes with the ever-increasing International emphasis on environment and sustainable development.

As we approach the year 2000, the Thai economy must again go through transition to ensure ongoing International competitiveness. Naturally, we must build on the industrial base created since the mid 1970s. As part of the new transition we must clearly focus our efforts on building up knowledge and high-technology development.

As a separate part of the adjustment, but nonetheless important-to-maintain competitiveness, a much higher emphasis must be given by domestic producers to environmental management in response to the new environmental trade pressures which are emerging in key export markets around the World.

Increasingly, we see that our ability to compete as an exporting nation will be deeply affected by the environmental management performance of Thai industry. It is also well accepted that in the post Uruguay Round era, environment possesses the potential to become one of the most explosive and divisive trade issues, if the developed and newly industrializing countries were allowed to meet head on over it. This must be avoided at all costs.

There is no doubt that the Trade and environment debate throws up many complex and taxing questions for businessmen around the World, particularly for manufacturers in newly industrializing countries. Also, we must acknowledge early on that there is no trade-environment panacea. A clear understanding of the issues and many years of negotiations lie ahead, if balanced answers are to be achieved for such subjects as environmentally-related product and process standards.

We see that environmental issues in trade are already firmly on the agenda. environment is embedded in International trade agreements such as NAFTA, the various trade initiatives of the European Community and its member states, and there is no doubt environment will come to the fore in the deliberations of the World Trade Organisation (WTO), once that body is firmly established.

I therefore would like to spend some time this morning on the challenging subject of Trade and Environment and look at ways in which Thai and British business people might work together to improve the environment in Thailand.

Simply stated, business in Thailand must change course on its handling of the environment as part of the adjustment required to maintain a competitive International trading position.

Before looking at these issues in some detail, I would like to spend a few minutes telling you about the environmental management changes already underway in Thailand and why I believe the country is now well placed to make the adjustment required for on-going International competitiveness. The country has, in fact, laid the groundwork to put it on the pathway to achieve Sustainable Development.

Thailand Steps Forward

While acknowledging that Thailand is in the early stages of its environmental adjustment process, I would say that since 1992 the country has, in anyone’s terms, made impressive legislative and institutional changes and we are now beginning to see greater understanding of the issues in business and industrial circles.

There is growing awareness of the need to utilize economic instruments to internalise environmental costs and, as part of that, the Polluter Pays Principle solidly underpins the country’s revised environmental legislation.

The keen interest and efforts of their Majesty’s the King and Queen in many environmental projects have mobilised the Thai people in protecting our country’s rich natural heritage and environmental health.

In influential sectors of the Thai society, awareness is growing of the need for government, business and communities to work together to address environmental management and natural resource concerns which have arisen as a dark shadow haunting our impressive economic growth. Let me highlight several positive examples:

• Firstly and most recently, the creation in 1993 of two bodies, the Thailand Business Council for Sustainable Development (TBCSD), which includes as its members many of the country’s leading industrialists and business figures, and, secondly, the Thailand Environment Institute.

These two bodies provide forums which are energetically exploring and formulating mechanisms for co-operation between business, government, and communities to combat natural resource destruction and industrial environmental concerns.

• Secondly, the early 1990s saw a rigorous overhaul of the country’s environmental legislation and we are now seeing the early effects of these changes. Notably, a new National Environment Protection Act was introduced and specifically dove-tailed with a strengthened Factories Act, to create a solid foundation to support development of integrated environmental management, now and in the future.

• Thirdly, legislative changes have been made to address specific and pressing problems. For example, the 1992-enacted Promotion of Energy Conservation Act is an innovative piece of legislation to encourage more efficient use of our energy resources in the industrial, residential and commercial sectors. Some may say this act was a visionary step for an industrialising country to take. The acceptance of a Demand Side Management (DSM) plan by the power authorities is also a significant development in the energy sector.

• Lastly, of all the positive developments, I feel it was the restructuring and institutional strengthening of the country’s environmental agencies which is of greatest significance. Our former Science and Technology Ministry was reorganised into the Ministry of Science, Technology and Environment and three new departments within that Ministry were created to deal with specific environmental management tasks. Two years later we are seeing a much higher level of activity from a group of energetic officers staffing the new departments.

These are just a few examples of the many positive developments which are creating a firm foundation for much improved environmental management in Thailand.

I firmly believe that it is government’s duty to create a strong, transparent and effective regulatory framework, which will allow business to adjust steadily in developing improved environmental practices while maintaining competitiveness.

I cannot emphasis too strongly my view – and this applies not only to Thailand, but to all countries – that business must be brought more closely into the policy-making process. Government cannot do it alone, and neither can business. We need a partnership to work out an agreed agenda, develop common policies and decide our respective roles for implementing the actions we have resolved to take.

Environmental Management Challenges

Returning to the Trade and Environment question, I have said that while adapting to the demands of tougher domestic legislation and enforcement, Thai industry, like others around the World, will be increasingly challenged by higher environmental trade requirements in major export markets.

Already we are seeing a plethora of new environmental trade initiatives and upcoming standards: ISO 14000; the British Standard BS 7750, which I will come back to later; and the European Community’s 1993 Eco-Labelling Scheme and its Eco-Management and Audit Regulation (EMAR), to name but a few.

For observers who follow environmental developments closely, this is a challenging time of great change. For business people who fear the impact of environmental pressures, whether domestic or International, on their bottom line, the mass of information and speed of new developments can be intimidating.

Despite the best efforts of various International organisations, it will be some years before we see a true consolidation, creating a clear and Internationally-acceptable norm for environmental trade issues.

There is a likelihood that many of the efforts underway will be viewed by politicians and business people in newly industrializing countries as non-tariff barriers to trade, created by Western countries, to allow unilateral imposition of trade devices to promote their own national environmental objectives.

It is a fact that the International community must guard carefully against the unfair imposition of such trade tools, for nothing will undermine International trade negotiations as destructively, if allowed to develop.

In order to frame an effective response, it is useful to predict the environmental trade pressures which the business community will have to contend with increasingly during the mid to late 1990s.

Firstly, increasing attention will be paid to the appropriate ways in which products and process standards can be fairly integrated into the environmental trade debate. This issue possesses the potential to be the most difficult to resolve. Trade specialists and environmentalists tend to take the opposite view on product and process standards. The former strongly oppose process standards, other than those regulating labour activities, and are keen to promote harmonised product standards .

In contract, environmentalists tend to support minimum product standards, opposing harmonisation, but believe minimum and even harmonised process standards are a necessity to mitigate the impacts of industrial pollution.

Secondly, environmental pressure groups – who, like many in business and government, are only just starting to grapple with the complexity of environmental trade issues – will focus more on the environmental performance of producers in industrialising countries. Some groups have already, and unfairly, adopted the term “Eco-dumping” to describe the export of goods from countries where the true costs of pollution are not incorporated into the productive process.

Finally, distinguishing genuine national trade measures from environmentally-motivated non-tariff barriers to trade is not a clear cut matter. We see the on-going processes of structural adjustment in many of the developed nations and, when economies are not rebounding as quickly as governments might wish, the desire to protect domestic industry from fierce and low cost competition, from countries where environmental management lags behind, can become strong. Trade measures are a powerful tool and the forces of protectionism can easily come to the fore if not contained in the debates of International forums.

The issue of competitiveness is a difficult one. Some countries – generally, developed countries – are moving to internalise environmental costs, with the result that the gap between them and newly industrialising countries is growing. I am in no doubt that we in the newly industrialising countries must accelerate our progress towards setting higher standards – preferably through the wider introduction and application of economic measures to internalise costs.

However, developed countries must be realistic about how rapidly we can act. Certainly any attempt, through trade measures, to force us into acting faster will prove counter-productive.

We need the same degree of patience on harmonising standards. International harmonisation is a desirable goal, but we must remember that competitiveness is an amalgam of many factors – resources, labour costs, cultural preferences, government regulations, technological development, educational systems and so on – not simply of differing environmental standards.

What is essential, as I have said, is that global markets remain open and competitive. This is essential on both economic and environmental grounds. I know that Britain and British industry support this position, and will lend its powerful influence to resisting the risen voices of protectionism.

Business Response: Eco-efficiency and Environmental Management Initiatives

It is not a difficult task to predict the general form of the new environment-trade pressures which are emerging but, the key question remains. How should Thai industry, and business globally, respond to these new challenges?

One response, which is starting to gain the genuine support of influential sectors of the International business community, is the move to promote the concept of Eco-efficiency, a term coined by the Business Council for Sustainable Development (BCSD) after the Rio Earth Summit. The concept is a simple one and makes ultimate economic sense: Eco-efficiency is the process by which value is added to products and services, while using raw materials more efficiently and aiming at eliminating pollution.

There are clear imperatives for business to accept the challenge of Eco-efficiency and make it a reality in coming decades. By the year 2025 it is predicted that World population will jump from five to eight billion people, many whose even most basic needs will not be met adequately.

Further, the World Bank forecasts that World Economic output will increase 3.5 times by 2030 reaching approximately US$69 trillion at 1990 prices.

We should be clear that Eco-efficiency goes beyond the traditional end-of-pipe mentality, to an approach aimed at preventing pollution in the first place. Rather than wait until the part is broken before fixing it, the objective from the outset is to prevent breakages occurring. And changing patterns of production will require a particular focus on innovation – to design and develop new technologies, new processes and new products. Let there be no doubt that Eco-efficiency is the proper corporate response to the global goal of sustainable development.

This is an area which requires cross fertilisation of ideas between business people if the goal of Eco-efficiency is to be realised. As Chairman of the Business Council for Sustainable Development, a body bringing together business leaders from more than 30 nations, I can assure you that the interest of the International business community in Eco-efficiency is growing steadily and the concept is taking root in Thailand.

Indeed, I am pleased to say that the Thai Business Council for Sustainable Development has just adopted a set of business guidelines for sustainable development. They include:

• establishing a definite and achievable corporate environmental policy based on the precautionary principle, a policy that invests in pollution prevention rather than clean-up

• ensuring environmental soundness of products by considering their entire lifecycle implications

• promoting energy conservation and waste minimisation, including recycle of materials and residues, and the use of clean technologies which will generate less waste

• introducing environmental auditing by undertaking environmental impact assessment before initiating a project, and complying with established standards, irrespective of regulatory mechanisms. Business should strive to set its own environmental standards whenever government regulations do not exist

Britain, with its introduction of the standard “BS 7750: Specification for Environmental Management Systems” is taking an early lead in developing the tools which will help business turn the concept of Eco-efficiency into a reality.

Indeed, it is likely that the International Standard Organization (ISO) environmental standard, ISO 14000, currently under development, will be based in part on BS 7750.

The British Standard specifies requirements for the development, implementation and maintenance of environmental management systems, aimed at ensuring compliance with stated environmental policy and objectives.

Recently, Thailand Environment Institute (TEI) completed a project to assess the extent to which a number of Thai companies have adopted environmental management systems, and the British Standard was used as a key bench-mark in the exercise.

Higher standards are essential. They will drive companies faster down the road towards Eco-efficiency, by requiring them to look for the new processes, technologies and products I mentioned – in short, to find new and improved ways of doing things.

There is no doubt in my mind that close co-operation between British environmental specialists and Thai business people, will foster a climate more receptive to the new ideas and challenges of environmental management, and ultimately Eco-efficiency.

That is not to say we should expect business to solve their environmental problems overnight, in Thailand or anywhere else. That is simply not realistic and, if forced too quickly, will only undermine the economic engines, namely entrepreneurial drive, which will ensure on-going prosperity and, hopefully, a much more equitable distribution of the fruits of growth for all.

In conclusion, let me add that there are many antecedents for Thai-British co-operation, as well as a strong history and mutual interests linking our two countries. Indeed, many of our current leaders, in a diverse range of political, business and academic fields were educated at the schools and universities of Britain. There is no finer way of breeding common understanding.

I believe there continues to be great scope for Thai-British co-operation and, might I end by saying, no area holds such an imperative for joint learning and action as do the fields of environmental management and environmental improvement.

Partnership for Change and Progress

Anand Panyarachun
Chairman, BCSD Geneva
Chairman, Council of Trustees, Thailand Environment Institut
Presented at
The East Asia Pacific Parliamentarian
Conference on
Environment and Development (EAPPCED II)
Thursday, 21^st April 1994
Phuket, Thailand

During the next three days, this conference will discuss in some detail a number of issues of great importance to this region, and beyond.

I belief I can best serve you this morning by mainly focusing on one area: partnership between government and the private sector – which in my judgement, is of fundamental importance to the way we approach those issues, and others.

Government of course includes you as Parliamentarians, as well as Ministers and officials. And I single out the private sector – business – as a partner because it has a critical role to play in achieving a successful marriage between development and the environment.

Business after all is the driving force behind economic growth, and the increasing prosperity that much of East Asia and the Pacific area is enjoying.

Yet, as we all know, we have been paying a price for this economic success.

For example, you will have seen the recent World Bank report on the state of the environment in Asia. It is a cause for dis-satisfaction.

• The levels of sulfur dioxide, nitrogen dioxide and total suspended particulates in the air – three especially dangerous industrial pollutants – have increased disturbingly: by a factor of five in Indonesia, eight in the Philippines and ten here in Thailand.
• Five of the seven cities in the World with the worse air pollution are here in Asia.
• At current rates, Asian countries will be producing more sulfur dioxide than Europe and America together by the year 2005.

I am not attaching blame. But I feel it encumbrance on me to apportion responsibility for addressing this urgent situation – because in the developing countries and emerging economies we can afford no longer to have economic progress at the expense of a safe, healthy environment.

As legislators, you most certainly have a contribution – a major contribution – to make.

But clearly the primary responsibility will – and must – rest with business: which faces the challenge of reducing the levels of pollution dramatically, but without harming our industrial and economic performance.

Business however cannot do it alone.

Partnership must be the cornerstone for achieving our common objectives.

Partnership between you in government and we in business to work out an agreed agenda, and partnership to work to that agenda through developing common policies and deciding our respective roles for implementing the actions we have resolved to take.

It is happening – for example in the ASEAN region, through the establishment of joint public – private consultative committees, chaired by the Prime Minister of the country, and attended by leading CEOs in that country.

This is a promising beginning. But we need to accelerate matters, and bring business more closely into the policymaking process.

Your particular contribution – indeed the responsibility that has been entrusted to you – is to set the standards for environmental performance. And I say very firmly that you should not flinch from setting high standards, tough ones.

Tough, demanding standards are important to improving the well-being of the communities you serve – and they will be the stimulus for improving business performance. They are not an obstacle for business to cross or worse, to circumvent – they are an opportunity which business should grasp.

Many of you I trust have heard of the motion of Eco-efficiency.

It is a concept developed by the Business Council for Sustainable Development in its report ‘Changing Course’ to Rio. The BSCD is a group of business leaders from around the World, and I am privileged to be its current Chairman.

An Eco-efficient company is one that adds value to its products and services, while using raw materials and energy more efficiently and aiming towards – and ultimately succeeding in – eliminating pollution from its processes and products.

This approach goes beyond the traditional end-of-pipe mentality, to one of striving to prevent pollution in the first place. Rather than wait until the part is broken before fixing it, the objective from the outset is to prevent breakages occurring.

Eco-efficiency is the proper corporate response to the global goal of sustainable development. It is also the right response to the particular situation we in this region face at this stage in our development – and it should become the benchmark by which business sets out to measure itself, and be measured by, in the future.

There is much that we in business can do ourselves – and should be doing – to move our process and products further and faster towards that goal.

But as I stated, no-one at this conference should assume that it is down to business to do it alone. On the contrary, government – including Parliamentarians like yourselves – must support, and work with business to promote and step up the process of change.

I said that high environmental standards are the key. They are, Tougher standards will drive companies faster down the road towards Eco-efficiency by requiring them to look for new processes, technologies and even new products – in short, to find new and improved ways of doing things.

But the manner in which government – you – lay down those standards will be crucial to their effect, and to their effectiveness.

Most businesses – wherever they are in the World, and this region is certainly no exception – operate within both a set of laws and an economic framework laid down by government.

You can impose new laws, and the means to enforce them. They will serve their purpose – to a point.

But by themselves, new regulations will not be enough to reap the economic and environmental dividends that are possible.

We need to reform business behaviour so that it reflects environmental truths. But we must also see that society’s behaviour reflects those truths too.

For example, if we want business to include environmental costs in its balance sheet – and we should want this – society must accept the consequences. There will be a price to pay – literally – as environmental costs are allocated to processes and products, and therefore we must make changes to our economic system to take account of that reality.

We are in danger of overlooking the fact that at Rio, the heads of state and government signed off on an economic, not an environmental agenda. The changes they endorsed were economic – not environmental – in scope.

The emphasis in the Agenda 21 program – indeed in every major document approved in Rio – on the role of economic instruments (taxes, charges, permits and so on), and their importance to internalizing costs illustrates the point.

Economic instruments are – as their name says – an economic measure, not an environmental weapon. The benefits will be both environmental and economic; moving us away from the present wasteful use, over-consumption and depletion of resources to a system that values, encourages and rewards conservation, pollution avoidance and efficient resource use.

That will be to the immense benefit of every citizen – and it will also be good for business.

Traditional command-and-control regulations will continue to play a role. But increasingly – as Rio tacitly acknowledged – economic instruments will prove a more effective means of improving corporate environmental performance, and the environment generally.

I also urge you to take this into account when you come to consider new, higher environmental standards.

I also urge you to work with business – and other groups with a direct stake in these issues – to implement a common agenda: an agenda which should include:

• Simplicity

• regulatory reform

• Fiscal reform

• subsidies

• timetable

Such an agenda will enable us to meet our common objective – which is to make the markets work for sustainable development. The markets have treated us well from an economic standpoint: now we must ensure they work as successfully for our environment.

Plenary Session III on Saturday will deal with trade and environment. I think it appropriate for me to address this topic.

Open, competitive global markets are essential on both economic and environmental grounds – and the successful completion of the Uruguay Round is clearly a milestone towards a further opening of markets, and to increasing competition.

However, as you know, we are now moving into a next phase – with GATT and its successor, the World Trade Organization due to embark on a two-year work program designed to make trade and environment policies mutually supportive. That program will embrace some difficult areas, and I fear that some of the tensions apparent during the Uruguay Round negotiations are likely to resurface.

The issue of competitiveness will, I believe, assume an even higher profile on the agenda – especially as countries move to internalize environmental costs in different ways, and at different speeds.

The particular risk is that governments will perceive a loss of competitive advantage, and will respond by resorting to trade measures against countries with, in their view, lower environmental standards. We are all familiar with the argument that weaker environmental regulations in mainly developing countries give producers there an unfair advantage.

It is a fact that generally speaking, developed countries are internalizing costs faster – and according to the OECD, the gap between them and developing countries is growing.

I repeat my view that we in the developing countries and emerging economies should accelerate our progress towards setting higher environmental standards, preferably through the wider introduction and application of economic measures to internalize costs.

At the same time however, developed countries must be realistic about how rapidly we can act. And certainly any attempt, through trade measures, to coerce us into action faster, will prove counter-productive.

The issue of trade and environment, and competitiveness are also related directly to the harmonization of environmental standards.

Certainly, this is needed in some key areas – climate change, ozone layer depletion, endangered species, biodiversity, acid rain and cross-border pollution – and there are in fact some 15 International environmental agreements in place.

But let us remember two things:

1. It takes time to reach an International consensus on issues. And if governments expect International standards to be agreed, they may use this as an excuse to delay implementing their own domestic policies meanwhile, I sincerely hope you will avoid that trap.

2. International harmonization may be a desirable goal. But we must keep in mind the national, sometimes regional, differences in ecological carrying capacities, climate conditions, natural resource endowments and environmental priorities – which are all sources of a country’s or region’s competitive advantage, and which we will be loathe to relinquish without proper safeguards.

Indeed, competitiveness is an amalgam of many factors – resources, labor costs, cultural preferences, government regulation, technological development, effective educational systems and so on – not simply of differing environmental standards.

Harmonization is desirable as a long-term objective. But the majority of environmental problems are local, and in my view are best treated at that level. And we should not be sidetracked from the urgency of our task here – which is to raise our environmental standards throughout East Asia and the Pacific.

I would also like to mention the issue of Joint Implementation – as a specific example of what the private sector can do to strengthen collaboration between developed and developing countries.

As you know. The Climate Change Treaty which came into force on March 21 for those countries which ratified the Rio Convention, includes the principle of Joint Implementation.

This allows countries to partially meet their commitments under the Treaty to reduce their greenhouse gas commitments by investing in emission reduction in other countries. Most of the World’s greenhouse gas emissions come from developed countries – and the expectation is that Joint Implementation will mainly involve agreements with developing countries. For example, a North American coal-burning electric utility could earn credits by lowering CO2 buildup through increasing the efficiency of coal-based power production in China.

There are a number of concerns, especially among developing countries, about Joint Implementation. One is the fear that it may absolve the North of changing its behaviour while adding burdens on developing countries. Another is it may cause traditional sources of foreign aid to dry up. Joint Implementation has even been called a form of ‘eco-colonialism’.

I understand those concerns – but personally, I do not share them.

In my view, Joint Implementation is an important example of how the private sector can play a critical role in providing significant, tangible sustainable development benefits – important new resources to developing countries – through Eco-efficiency and Technology Cooperation.

And the role of the private sector is particularly critical because it is clear that available government financial resources to reduce greenhouse gas emissions will be inadequate – and private sector capital will be needed.

I am pleased to say that the BCSD has a task force examining this whole issue. One of its tasks is to provide the business perspective to the debate, and to raise awareness of Joint Implementation and its benefits.

In conclusion, let me say that in East Asia and the Pacific, we face a considerable challenge.

We need to redress the damage already done, to make our cities liveable, to make the lives of millions of our peoples bearable. And, as we develop our economics further, to sustain our competitive presence in the World, we have to avoid compounding the waste and pollution that already besets us.

But with that challenge comes an opportunity to show to the rest of the World that it can be done: that we can achieve significant rewards – for the environment, and for today’s and tomorrow’s generations of our peoples.

I have no doubt that together we can prove ourselves to be more than equal to the moment.

Mr. /Madame Chairperson,

Distinguished Delegates,

Ladies and Gentlemen,

It is indeed a pleasure for me to welcome all of you to the XVIIth World Congress of Epidemiology.

The theme of this Congress deals with issues of equity in promoting health for development. This is crucial as good health is a basic human right and a necessary foundation for economic and social development as well as human security. The pivotal role of health in the overarching goal of poverty reduction and sustainable development was recognized by the inclusion of three health-specific Millennium Development Goals among the eight adopted in 2000 by the Heads of State and Governments attending the United Nations Millennium Summit.

The twentieth century has witnessed a dramatic decline in average human mortality due to rapid economic growth, particularly in countries of the North Atlantic and this has spread to other parts of the world. Much of average human heath improvement has been due to advancements in health technology and income growth, which has enabled countries to invest more in health.

However, many parts of the world, such as Sub-Saharan Africa, as well as parts of South Asia, have failed to share in the overall dramatic gains in human health and reduction of mortality. In most countries, people in the rural areas, especially indigenous peoples, are far less healthy than their compatriots.

At the same time, there are outstanding examples, such as Sri Lanka, Kerala State in India, and Cuba, that have achieved very good health status without high or rapidly growing incomes. In many developing countries, health budget allocations are concentrated on the secondary and tertiary levels, neglecting basic health services, especially for the poor.

This indicates that factors other than just economic and income growth have significant bearing on how countries benefit from advancements in technology. What it means is that the right kind of investment has the potential to yield major gains.

It is, therefore, critical that healthcare systems are strengthened around primary healthcare, in line with the principles of equity, universal access, community participation and intersectoral collaboration. These principles, as endorsed by the Alma-Ata Declaration, hold true 26 years on from Alma Ata and their neglect costs us dearly today. Indeed, it can be argued that this “right” investment must be sensitive to enhancing equitable and adequate access to education, health and natural resources. To reduce present disparities and be successful, states must choose the right mix that enhances social opportunities and effective resource utilization.

The “right” and successful investment is central to our thinking and approach to health and poverty. The income expenditure criterion for defining poverty and for targeting health service to the poor has been challenged. Increasingly, it is being replaced by a new definition of poverty based on the capacity of the poor to improve their conditions, including their health status and education.

In other words, rather than treating health and education as matters of state welfare for the poor, we might consider giving opportunities for all, including the poor, to have better access to these social services so that the poor will have more capacity to actively improve their conditions and become a more valuable asset to society. Achievement of the three health Millennium Development Goals on child mortality, maternal health, as well as HIV/AIDS and other major diseases is closely inter-linked with the other Millennium Development Goals, especially those pertaining to the reduction of income poverty and the improvement of gender equality and environment and sustainability.

The latest review of progress on the health Millennium Development Goals indicates that health should be moved to the centre of the development agenda. Increasingly, poverty and inequity in health must be tackled together in policy and in the intellectual sphere.

Investments for better access to social services are those that aim to increase the capacities of individuals and institutions to apply and integrate technological advancements with contextual and tacit knowledge to reduce poverty and improve equity in health. The goal is to harness the power of knowledge and technology for good health, regardless of its sources.

Therefore, it means that the search to discover and apply "knowledge" must be an inclusive and learning process, pursued as much by scientists in the best research institutions as farmers planting rice in different fields, or mothers trying different food regimens to help their children grow.

While it is important that this Congress adopts a global vision of the human family, it is fitting that a key concern for this Conference be the reduction of the huge health disparities among and within countries.

In doing so, the Congress will help end the era of "neo-colonialism", namely a period of exclusive knowledge production in the North for technology transfer to the South, opening a new era of bringing together knowledge producers and users in the South to join the world health knowledge system.

I believe that if we can strengthen national capacities to generate and apply knowledge through sound policy and social processes, we can advance equity in global health. Such investments require the commitment of people and leadership with a passion to make things happen.

The Congress has been designed as a forum for dialogue and exchange of diverse perspectives and ideas. Of the 1000 attendees, 600 are from developing countries. I am impressed by the caliber of the participants. Let the Congress environment create a passion for change, a passion to make things happen, a passion to build capacity to integrate knowledge from different sources and bring technologies to where they are needed.

Distinguished delegates, ladies and gentlemen,

Assuming that a country has an able and committed leader, what are some of the challenges or key issues for advancing equity in health for development that could be discussed this week?

The first key issue is the effect of globalization on the new capacities of the producers and users of knowledge. Today, nations are experiencing economic transition propelled by globalization. There are fundamental differences in the principles and values underlying the goal of health for all and recent trends in globalization that drive socio-economic and health systems.

With regard to the goal of “Health for all”, Government is the mainstay of health and social services. The goals and values of Government are thus to meet equally the needs of every individual. That is the basis of equity.

In contrast, globalization is not about equity but rather about individual rights and the emphasis is on the methods to get those rights fulfilled. Accordingly, “individual rights” means that access to any health service depends on the individual’s ability to pay, regardless of who provides the services.

Equity requires that governments ensure that everyone’s basic needs are met and therefore governments must resort to a degree of central planning and resource allocation based on a non-price mechanism. Globalization, on the other hand, pushes for private ownership and resorts to the market mechanism to do so.

Thus, it seems that equity in health and globalization are supporting different social values. The plenary on the first day of the Congress provides a forum for discussing the different values and aims, with a view towards a harmonization of these values.

The Congress will also address the need for knowledge-based decision-making by stakeholders. It will consider methods to monitor health equity, and health investment, and methods to feed the information on equity and investment into the political and social processes to devise better investment of limited resources to improve health.

The plenary on the second day will address methodological issues which would allow us to monitor health inequities and bring them into the mainstream of political and social processes. That plenary will encourage more attempts towards refining ways for policy makers and civil society to get knowledge and use it to make better investments.

Therefore, the Congress will reaffirm, beyond doubt, the importance of health research to improve equity. Research is needed to define the problems, lay out the determinants and options, and develop ways to deal with inequities through the political and social processes, which enhance accepted methods of conflict resolution. Research is essential, not a luxury. It is necessary for achieving good health.

Research must not only be multi-disciplinary but also integrative. In the new knowledge-based global economy, the power of research is widely recognized. We are in agreement on knowledge as a global public good. Our shared goal is global and local health equity, with social justice, and health as a basic human right.

Gender equality is central to the attainment of this goal. In the pursuit of research, it is necessary to recognize explicitly issues that affect women and girls differently from those of men and boys. Let us also keep an open mind to the value of wisdom that lies very much with those who have little formal training but a wealth of practical experience.

The "research divide" is less between basic-applied, global-local, or producer-user, and more between whether research serves the rich and privileged or meets the health needs of the world's poor and disenfranchised. Spending on research and development is mostly concentrated on diseases that affect developed countries, while the diseases that most commonly afflict the poor (for example, tuberculosis and malaria) attract relatively little investment. Only 10 per cent of the money spent on research is dedicated to the development of therapies that could improve the health of 90 per cent of the world’s population. This must change.

Among countries that use research to improve equity, there is considerable variation. Plainly evident are marked differences in research capabilities, performance, and constraints. In some countries, health research has advanced significantly. Others have been left behind, suffering from decaying or even collapsing infrastructure. A major conference challenge is the harmonization of such diversity with a clear focus on health equity.

Key constraints on research aimed at improving equity include weak human resources, institutional infrastructure, and financing. The producers as well as the users of research need an environment that creates motivation, skills, career structures, and an interactive critical mass.

Infrastructure is necessary to provide an enabling environment that nurtures a research culture. Flexible financing is required. Commitment by actors involved will be important to mobilize public funds from the countries themselves, supplemented by foreign development assistance. Efforts must be made to be self-sufficient in the long run and attempts made to avoid perpetual dependency on foreign aid. This is why it is vital at the global and local levels to make knowledge instrumental in the political and social processes to enhance equity.

During the third day of the plenary, the Congress will discuss the utility and challenges around large studies. Large studies are important for answering difficult questions on equity in health. Large studies are most useful when scientists of developed and developing countries join hands to make them happen in the spirit of South-South cooperation. It requires committed leadership, the motivation of partners in research, as well as the desire to learn together and generate knowledge to tackle difficult problems.

These studies have important bearing on measures to deal effectively with inequity in health for development. A social, economic and political environment that is conducive to equity-focused health research is a critical enabling factor for mounting large studies inexpensively. At the same time, it would be necessary to maintain scientific rigor and guard against the exploitation of the weak by the powerful, both in terms of scientific capability and economic strength.

Ethical considerations are also important to protect the public and the human subjects being studied from undue harm. While measures are developed to achieve such protection, some have argued that they could delay or even impede the generation of new knowledge. However, this consideration is particularly relevant in the new era of genetic epidemiology, drug and vaccine trials, stem cell studies, as well as large epidemiology studies. Transparent deliberation is called for on issues such as data protection, revealing of the patient's information, and consent for use of blood or other tissues for research.

Distinguished delegates, ladies and gentlemen,

Equity in health for development calls for a new way of doing things. This new way includes a new harmonized value system, new partnership arrangements, and new ethical approaches. The design and operation of all this may be wanting for legal, managerial and other non health knowledge. The public must have the space to participate in the initiatives not only by expressing their concerns and needs, but also in the development of innovative finance, organization and monitoring of health services and in arrangements for appropriate regulation and incentive structures.

Ultimately, our commitment is to the well-being of humankind. This Conference provides us with a valuable opportunity to strengthen our solidarity and commitment, to forge our way forward together.

I should like to pay a tribute to those who made this Conference possible. I appreciate the commitment of all to be here, despite your heavy schedules, and to give Thailand the opportunity to be your host. I am sure that the collective commitment, vision, and concern for the public good, and particularly for vulnerable groups, will serve you all well in your efforts to enhance partnership toward securing health equity.

I believe that this Conference will be a significant milestone in the long journey of our search for equity in health. Like the Chao Phraya River which nurtures life along its banks, the Conference is part of the global flow of epidemiological and health research for development, in which everyone here has a role to play.

I wish you all every success in your endeavours.

Thank you.

Distinguished guests,

Delegates,

Friends,

I am honoured to be here today. I want to first welcome to Thailand the representatives from countries and various organizations across the East Asia and the Pacific Region.

For millions of children around the world, HIV and AIDS have starkly altered the experience of growing up. Globally, it is estimated that 2.3 million children under 15 years of age are infected with HIV, and that more than 12 million have lost one or both parents to the disease. Though the estimated number of affected children in this region is comparatively small given the region’s generally low prevalence rates, the reality is that we do not quite know the full picture due to massive underreporting.

But we certainly do know about the reality faced by children affected by HIV and AIDS in this region, and it is indeed a bleak one. They experience too many losses too early in life, including the loss of parents, loss of security and the overall well-being of their family, loss of effective access to education and other essential services, and the loss of dignity due to stigma and discrimination. Many of these children also face the danger of repeating the perilous journey of their parents while growing up, adopting risky behaviours out of pressing needs for survival, for want of care-givers’ guidance or due to despair and the lack of hope and opportunities for the future.

Yet with improved public knowledge and understanding of the epidemic and improved access to anti-retroviral drugs, children affected by AIDS and those living with HIV no longer need to be doomed to lives of illness, alienation and penury. They can be free from deprivation of parental care and chronic illnesses. They can attend school. They can have families and communities that love and care for them. They can, in short, grow up just like other children. However, major gaps still exists between these possibilities and the realities, and it is these gaps that we must close at all costs.

This meeting will take stock of the progress made in ensuring positive change for children affected by HIV and AIDS, share experiences in promoting these changes, and once again confirm and strengthen our commitment to ensuring a better future for these children.

I am very pleased to note the recent decline in HIV prevalence in Cambodia and Myanmar, and I am sure these new success stories will be discussed during this meeting. In the spirit of sharing lessons learned, I would like to talk a little bit about the experiences of Thailand – the example that I know best.

As you already know, the number of new HIV infections in Thailand has fallen drastically, from the peak of 143,000 in 1991 to 14,000 in 2007. And for those living with HIV, there is now greater access to anti-retroviral drugs.

When I became Prime Minister in 1991, HIV was rampant throughout the country. The number of new infections was at its peak. Sentinel monitoring of infection levels in all provinces indicated that the HIV prevalence had jumped five-fold within a two-year period. It was predicted that over the next 20 years, up to 10 per cent of Thais would die from AIDS. We were on the verge of a major social crisis. The traditional and punitive public health measures which had been practised up until that time to combat the epidemic clearly were not working.

In order to confront the challenges of the HIV epidemic, we also had to confront our own mindset and our own denial of reality. We had to accept that this epidemic was being driven by socio-cultural practices, which at that time no government wanted to admit existed. These included commercial sex, intravenous drug use and cultural practices such as the sale of children and young women into sex work. The fact that all these activities are illegal makes people want to deny their existence in our societies. Not only did we have to accept the existence of these practices, we had also to accept that they occurred on a large scale in Thai society. For example, over 20 per cent of Thai men were visiting sex workers every year. It was therefore necessary to publicly acknowledge the scale of the challenge of HIV, and to state that we were going to take urgent action to reduce its spread.

The highest political leadership was needed to effectively address HIV and AIDS. I established and chaired the National Aids Prevention and Control Committee under the Office of the Prime Minister. This committee became the coordinating body for national planning and public education on HIV and AIDS.

To mount a national-scale programme, we had to quickly and drastically increase the government budget for HIV and AIDS, rather than wait for help from foreign donors. The government AIDS budget for prevention and control was increased by over 9 times, from $2.6 million in 1990 to $24 million in 1992. After I left office, the budget increases continued under succeeding governments. In 1993, the government budget for HIV and AIDS went up to $46 millions, and in 1996 to over $80 million. These sums did not include aid from donors. It was definitely not “business as usual” in Thailand.

Backed by these resources, an unprecedented public information campaign on AIDS was launched. We recognised the necessity of educating the whole of Thai society, not just those groups at highest risk. We were fighting for radical change in perception and a behavioural change within Thai society.

We mounted a nationwide education and preventive campaign that enlisted the co-operation of all media. Safe sex and HIV messages were aired every hour on more than 500 radio stations and seven television stations. Ensuring that everyone received HIV/AIDS information was critical. This may sound like a straightforward campaign, but at the time the tourism industry was seriously concerned about the possible negative impact of such a public education campaign on tourism. Political commitment at the highest level proved crucial to balancing the need to promote public health education with the need to increase tourism, allowing the information campaign to proceed.

We also targeted parents and teachers, many of whom still had conservative attitudes. We initiated a national programme on HIV/AIDS education in schools and mounted a large-scale peer education programme for young people in the workplace.

We promoted prevention interventions among drug users, the majority of whom were young people. We also targeted sex work and established the “100% Condom Programme”, which enlisted the co-operation of agencies and individuals to distribute free condoms to clients of sexual services. At the same time, we took effective measures to ensure the high quality of condom on sale.

Very early on, we fought stigma and discrimination in order protect the rights of people living with HIV and AIDS. When I took office as Prime Minister, there was a proposal to pass legislation that would have restricted the rights of people living with HIV and AIDS. We did not allow this bill to pass. There were prevention campaigns that inadvertently reinforced the stigmatisation of people living with HIV and AIDS. We stopped those campaigns. We also lifted the ban on entry to Thailand of foreign nationals known to have HIV and AIDS.

The subsequent development and the overall decline in HIV prevalence in Thailand validated the approach we took in the early 1990s. Similar efforts were made in other countries in the world, and I believe that it was through such efforts that the course of the epidemic was changed.

The challenge we face now both in Thailand and elsewhere is how to sustain the commitment made and the momentum generated over recent years. It is also clear that as the AIDS epidemic grows and matures, the number of children affected will increase. A child-centered approach to AIDS is vital, and this calls for strong policy measures and programmes to protect children from multiple vulnerabilities and the likelihood of them repeating their parents’ journey and becoming the next generation of those most-at-risk of HIV. It also calls for the empowerment of families and communities, and improving operational linkages within the health system, and between the health, education and social support systems in order to foster the continuum of HIV prevention, treatment and care services. Experience in Thailand has taught us that the HIV epidemic is constantly evolving. Our approaches and responses to HIV must also be ever evolving to meet the new challenges.

Dear delegates,

There is never room for complacency. Despite positive developments in many countries, the situation that we face continues to be alarming. In 2007, there were almost 20 per cent more new HIV infections in East Asia than in 2001. Despite the remarkable efforts made in scaling up HIV responses, children remain the “missing faces”. There is an urgent need to mobilize the political will and additional resources required to respond to this troubling increase in infections. I know that you are up to this task.

In conclusion, please allow me to applaud efforts by the organizers of this meeting, and offer my compliments to all of you on the great mission that you are vigorously pursuing. I hope this meeting becomes yet another milestone in shaping our region’s collective agenda, commitment and response for children living with or affected by HIV and AIDS.

Thank you.