Environmental policy

Environmental policy08.09.2022

Green Climate Hub: prospects for Central Asia region

Saule Bishimbayeva, Head of the Center of Commercialization Competencies of Technologies, IGTIPC NJSC, PhD in Economics

Kazakhstan following global trends, sets ambitious goals in the fight against climate change - to achieve carbon neutrality by 2060 - and also to act as a regional climate hub of Central Asia for sustainable development.

In this regard, the President of the Republic of Kazakhstan, Kassym- Jomart Tokayev, at the recent 4th Consultative Meeting of the Heads of State, held on July 21 this year in Cholpan-Ata, emphasized the need to consolidate the efforts of the Central Asian countries in overcoming the consequences of climate change and taking urgent joint measures:

«...I am deeply convinced that it is no longer possible to overcome the consequences of climate change in Central Asia without consolidating our efforts. Therefore, in order to coordinate joint actions, we propose to establish a Central Asian project office for environmental protection and implementation of a coordinated policy on climate change in the region.»

This message of the Head of State is inextricably linked with the modern climate challenges faced by the countries of Central Asia - rising temperatures, growing demand for water and energy resources, which as a result affects the environmental security of the region on a global scale.

These challenges dictate the need for the accelerated development of certain areas of innovation and technological developments (“clean” energy, waste-free technologies, new technologies for efficient water management, convergent technologies, etc.), for many of which there are certain groundwork in the countries of Central Asia, but there is low level of their development and implementation.

Thus, according to the rating of the Center for Environmental Policy and Law of Yale University in the USA, the countries of Central Asia occupy very low positions in the rating of environmental efficiency.

Out of 180 countries, Kazakhstan ranks 85th (index - 44.7), Uzbekistan - 89th (index - 44.3), Turkmenistan -92nd (index - 43.9), Kyrgyzstan - 105th (index - 39.8), Tajikistan 114th (index

-       38.2) after Algeria and Burkino Faso. At the same time, the general trend of being behind in all five countries of Central Asia is growing, and the level of air pollution in these countries is exacerbating every year.

This rating was calculated using two aggregated indicators of respondents - the viability of ecosystem and the state of environment, which in turn were formed from 32 indicators:

-       Air quality;

-       Emissions of pollutants (SO2, NOx);

-       Water resources, drinking water;

-       Climate change (CO2, N2O, CH4, GHG);

-       Biodiversity and habitat;

-       and others.

This rating once again confirms the fact that the low environmental performance of the countries of Central Asia is a consequence of the aggravation of the environmental problems of the region, as well as the low level of implementation of environmentally friendly technologies in the countries of Central Asia, which is also a consequence of the lack of close interaction between the countries of Central Asia in solving problems of climate change and the environment.

Currently, the common problems of the Central Asian countries can be identified as:

Temperature increase, climate warming. The temperature increase over the past 40-50 years has been observed throughout the territory of Central Asia, which exceeds the global average. The number of hot days above 40 °C is increasing, which has a negative impact on agriculture and people's well-being.

Tragedy of the Aral Sea. One of the largest in the history of global environmental disasters in Central Asia is the tragedy of the Aral Sea. The Aral Sea crisis zone covers the territories of Turkmenistan, Kazakhstan, and Uzbekistan, as well as indirectly - Tajikistan and Kyrgyzstan.

• Problems of transboundary water resources management. The Central Asian countries have common ecosystems and rivers, where it is necessary to solve the problem of parity distribution of transboundary waters.

To overcome these and many other environmental problems, the Central Asian countries need technological transformation and the rapid exchange of efficient and cost-effective green technologies that would maintain balance and safety and restore the environment. Also, they can only be solved together, by combining the efforts of all partners from the countries of Central Asia to meet the environmental challenges for the transition to a green economy by creating a favorable environment for the development of innovations and the introduction of green technologies in the countries of this region.

It should be noted that according to UNIDO data, the global market for green technologies in the next decade is 6.4 trillion US dollars, of which 1.7 trillion US dollars is for the development of green business in developing countries.

Therefore, new opportunities and prospects are also opening up for the Central Asian countries within the framework of the climate agenda - through regional cooperation, to become growth engines for green companies in the Eurasian economic space.


KAZAKHSTAN AS A LEADER OF THE REGIONAL CLIMATE HUB

Within the framework of the COP 26 climate summit, held in 2021 in Glasgow, Kazakhstan proposed the creation of a Central Asia Climate Hub to address environmental problems of a regional and transboundary nature.

Currently, Kazakhstan has every opportunity to become a Leader in organizing a regional platform for green technologies - the Central Asian Climate Hub (hereinafter referred to as the Green Climate hub).

Kazakhstan is one of the first Central Asian countries that signed the Paris Agreement and, according to the concept of transition to a “green” economy, the country should increase GDP by 3% by 2050, increase the share of renewable energy to 15% by 2030, and reduce greenhouse gas emissions by 2030. by 15% of the 1990 level.

Considering Kazakhstan's geographic location in the Central Asian region and the intention to develop financial and institutional capacity for green technologies, Kazakhstan is a favorable place for attraction of the innovative activity in the field of green technologies to support business and all stakeholders.

According to the Massachusetts Institute of Technology University (MIT), Innovation Hubs are centers of attraction for innovation activity, where dense networks of interconnected technology companies and technology customers are concentrated.

As a rule, hubs are special territories or spaces where conditions are created to revive the possibilities of the economy by stimulating a favorable environment for accelerated development and promotion of innovations in various industries and areas.

The main task of innovation hubs is to create and support professional innovation platforms, the success of which depends on the involvement of all key partners from the private and public sectors.

Typically, innovation hubs are created as independent legal entities that own a single material and technical complex on the basis of ownership or other legal grounds, where favorable conditions are created for the development of technological entrepreneurship in the relevant industry or area.

It should be noted that the creation of the GreenTech hub is one of the key activities in the implementation of the Roadmap for the development of the Green tech technology platform, approved on June 25, 2020 by the Ministry of Ecology, Geology and Natural Resources of the Republic of Kazakhstan (hereinafter MEGNR) and is aimed at the implementation of three components: (Figure 2).


The roadmap was developed as part of the instructions of the Head of State (reg. No. 19-01-7.30 dated 23.08.2019), together with the Ministry of Innovation, Digital Development and Aerospace Industry (hereinafter MIDDAI), where approaches were developed to prioritize the development of green technologies in innovation policy of the country.

The activities of the Green Climate Hub will be aimed at the commercialization of product innovations (batteries, cars, solar panels, sensors, micro-grid components, etc.), with economic incentives for the development of startups, where service support, acceleration, and business incubation of startups will be carried out at early stages. stages. This is due to the fact that over 70% of green projects in the country are projects at an early stage of readiness for implementation.

The creation of the Green Climate Hub will allow, with the help of state support instruments and special tax preferences, to revive the possibilities of the economy by stimulating an innovative environment for the development of green technologies and technological entrepreneurship.

LAUNCH OF GCIP- KAZAKHSTAN

This year, the launch, together with GEF/UNIDO, of the 3-year GCIP

- Kazakhstan - “Global Cleantech Innovation Program in Kazakhstan - Promoting Cleantech Innovation and SME Entrepreneurship to Create Green Jobs in Kazakhstan” could be a good foundation to create a GreenTech Climate hub.

The project is unique in that Kazakhstan is becoming part of a large Global GCIP platform covering 15 developing countries, and it is aimed at implementing transformational changes through the implementation of three components (Figure 3).


Currently, GCIP has become the basis for creating national Cleantech accelerators and incubators in 10 countries: Turkey, India, Armenia, Malaysia, Thailand, Pakistan, South Africa, Morocco, Moldova, and Ukraine.

The National Green Startup Competition will be held annually, which will identify the most promising innovative entrepreneurs across the country for their subsequent support in the form of startup acceleration, risk reduction and linking them with potential investors, clients and partners.

This will eliminate market and policy shortcomings that hinder the emergence, deployment and implementation of environmentally friendly technologies in the long term, which will help Kazakhstan to make a leap to a more environmentally friendly economy.

The CUP Kazakhstan competition will give priority to women entrepreneurs, coaches, mentors (at least 35%).

MISSION, GOALS AND OBJECTIVES OF THE GREEN CLIMATE HUB

✓      The Green Climate hub is a special area where favorable conditions will be created for the implementation

of innovative activities in the field of adaptation of the Central Asian states to climate change, commercialization, and transfer of green technologies.

✓      The mission of the Green Climate hub is to become a center for the development of innovative projects and breakthrough companies in the Central Asian region in the field of green technologies, as well as a center for technological entrepreneurship and attraction of a critical mass of talented specialists, and thereby to accelerate the process of transition of the Central Asian countries to a green economy.

✓      The purpose of creating the Green Climate hub is to promote innovation in the field of green technologies through an intersectoral and multilateral approach to reducing greenhouse gas emissions and creating a sustainable regional innovative ecosystem of green technologies for companies in the Central Asian countries in the following areas:

• Alternative energy (including hydrogen energy)

• Energy efficiency

• Adaptation, use of transboundary waters

• Green Building

• Waste management

• Modern materials and chemicals

• Transport

✓ The key task of the Green Climate hub is to ensure a high-quality flow of green technologies and projects for their further implementation in production, taking into account environmental and economic efficiency (and, as a result, social efficiency), i.e., reducing the negative impact on the environment and improving the quality of life of the population.

HOW CAN THE GREEN CLIMATE| HUB WORK?

With appropriate political support, the Green Climate Hub can play a key role in creating a regional innovation platform - an ecosystem of "green" technologies, coordinating the process of adaptation to climate change in the Central Asian countries, commercialization, and transfer of technologies, focused primarily on the technological demand of the Central Asian region.

MAIN STREAMS OF THE GREEN CLIMATE HUB:

Stream 1

Continuous support of companies from the Central Asian countries in the field of green technologies for the development of commercially successful companies;

Stream 2

Strengthening a favorable innovation ecosystem of entrepreneurship for the creation of new regional projects and programs;

Stream 3

Transfer of technologies and exchange of competencies between the countries of Central Asia;

Stream 4

Monitoring and collection of environmental information in the Central Asian region;

Stream 5

Coordination and consistency of actions of Central Asian countries.

IMPLEMENTATION OF STREAM 1

Green technology companies differ from typical companies in that the business is most often built on physical components (batteries, cars, solar panels, sensors, micro-grid components, etc.). Therefore, unlike, for example, IT technologies (process innovations), the commercialization and implementation of green technologies (product innovations) is a more complex process and companies have a longer "valley of death".


It takes time for companies to mature, higher levels of financial backing, and a variety of skills to succeed: accelerated prototype development, intellectual property protection, building and then scaling production, go-to-market strategy.

The Green Climate hub will consider projects with ready and proven technology, when all scientific research has already been completed and there is evidence of the existence of a well-defined product or service with properties and benefits that can be evaluated and tested by commercial customers. Assistance in the commercialization of green technologies will end when the product is successfully launched on the market.

Continuous support for entrepreneurs can be carried out through acceleration programs, technological business incubation (hereinafter referred to as TBI) - a program of continuous support for projects that provide entrepreneurs with opportunities and access to networks of investors/clients - informational, technological, legal, economic assistance.

As part of TBI, the Green Climate hub can provide the following range of se rvices: project expertise, marketing services, assistance in creating prototypes, developing business plans, legal, information and consulting support, attracting investments, project management, as well as other services necessary for the implementation of green projects in the Central Asian and GBPP countries.

Green finance promotion methods based on the best world practices will be applied to achieve the SDGs defined by the UN by countries. In Kazakhstan, such activities are already classified into a single taxonomy. Moreover, in Kazakhstan, there is a strong relationship between the best available technologies and green technologies at the level of the new Environmental Code. This positive experience is proposed to be transferred to all countries of the Central Asian region.

With the help of comprehensive support through TBI programs and incentives for green companies, it is possible to accelerate the technological transformation of the Central Asian countries in the field of green climate technologies. In this case, the introduction of any green technology will be evaluated in terms of its environmental and economic efficiency, i.e., taking into account the impact on the environment and human health.

IMPLEMENTATION OF STREAM 2

Based on the best practices of countries, an innovative platform will be created. This an ecosystem of green technologies will bring together all market players - specialized companies, large businesses, SMEs, authorities, development institutions, research institutes and universities, NGOs for cooperation and integration of information, technology and financial resources in order to create new products and technological solutions.

This platform will eliminate the gaps between the players in the green technologies market and will be the basis for creating a favorable environment for the development of innovations and the use of competitive advantages by combining the competencies of various stakeholders, and ultimately lead to the creation of joint projects and programs of the Central Asian countries. The success of the innovation platform will depend on the degree of involvement of all partners from the public, scientific and business sectors.

To do this, a competency map (mapping) will be created - this is the process of identifying the knowledge, skills, and contacts of organizations and their comprehensive classification, which will determine the strengths and weaknesses of the participants in the innovation platform. This will allow you to determine which area can be improved through joint activities and cooperation between platform participants and to develop a specific strategy to use existing strengths. Networking events, seminars, technology brokerage events will be held regularly, where investors, project/technology developers and representatives of legal entities meet.

These events will result in cooperation of teams and partners.

To be effective, a Green Climate hub must be inclusive of a range of partners, drawing on a range of sources of knowledge and experience, and leveraging different types of resources, while maintaining flexibility and coordination. Partners need to be engaged, motivated, and persuaded to cooperate with each other.

The effective functioning of the innovation platform will contribute to the dissemination of new "green" technologies among the countries of Central Asia, based on the collaboration of countries, the partnership of the state with business, the public and international organizations.

At the same time, the focus on practical results in the promotion and implementation of green technologies and projects remains an important aspect.

Also, the innovative platform can be strengthened by a digital platform in order to systematize a huge flow of information and become a single window in the field of green technologies for all partners in the region.

IMPLEMENTATION OF STREAM 3

The transfer of technologies and the exchange of competencies between the Central Asian countries will be aimed at adapting to climate change and solving common environmental problems of countries of this region.

Currently, a Charter has been signed between 16 GBPP countries, which will include new Central Asian countries.

However, to start practical activities on technology transfer, exchange of knowledge and competencies between the Central Asian countries, it is necessary to develop a mechanism for technology transfer between the Central Asian countries based on the best world experience. In addition, it is necessary to take into account the national legislation of each country in the field of Intellectual Property protection, to develop general legal acts on the transfer of technology or joint ownership of IP. It is also necessary for all Central Asian countries to join various international technology transfer networks such as WIPO GREEN and others.

As part of the exchange of competencies, at the national level in the Central Asian countries, it is necessary to move towards the introduction of the best available technologies. An increasing number of governments are making efforts to use a BAT approach. Among the Central Asian countries, Kazakhstan is the first state to apply BAT approaches that could transfer its experience, knowledge, and competencies in the implementation of this approach.

IMPLEMENTATION OF STREAM 4

The fight against climate change requires a long-term strategic approach and monitoring of the environmental situation. One of these areas is adaptation to climate change and preparation for its expected consequences. Adaptation is a global challenge that affects everyone at the national, regional, and international levels.

Moreover, for the correct implementation of measures to accurately determine the risks, it is necessary to model situations with climate change and the consequences of its change. In this regard, the countries of Central Asia may need to create an integrated digital information system. It should be noted that this area is very extensive, labor-intensive, requiring large financial investments.

IMPLEMENTATION OF STREAM 5

Effective implementation of the above directions requires clear coordination and compliance of actions of the Central Asian countries. In this regard, it is necessary to agree and subsequently legalize the mechanism of interaction, as well as to monitor the effectiveness of the current program.

One of the important components of activities of the Green Climate hub will be the creation of the Coordinating Center of the Central Asian countries, where clear coordination of activities, monitoring, and evaluation, as well as coverage and dissemination of knowledge will be carried out. In this regard, the Project Office of the Central Asian countries, the creation of which was announced at the meeting of the heads of state in Cholpon-Ata, could play the role of such a coordinating center.

With the right development of regional interaction and the introduction of working business models, the Green Climate hub can become one of the effective regional mechanisms for implementing the climate agenda and achieving the goals of the Paris Agreement by Kazakhstan.

Therefore, it is desirable that the Green Climate hub to be created together with an experienced international partner with a history of success in implementing an effective business model for the operation of an innovation hub in the field of environmentally friendly technologies.


CONCLUSION

Thus, the creation of the Green Climate hub will allow, using a systematic approach, to carry out a technological transformation, as well as to revive the opportunities of economies of the Central Asian countries by stimulating a favorable environment for creating a green business and developing technological entrepreneurship, attracting investments.

In essence, the Green Climate hub is a way to solve regional environmental problems on a mutually beneficial and self-sustaining basis, where the modernization of production should be evaluated in terms of environmental and economic efficiency, i.e., taking into account its impact on the environment, as well as the benefits for both technology developers and industrial companies themselves.

Benefits for the Central Asian countries:

Best practices clearly show that the pace of learning new knowledge in the field of ecology and environmental protection can be significantly accelerated through a set of active coordinated actions and

For Kazakhstan, the creation of a Green Climate hub - a territory of innovative activity for green technologies - will bring closer the achievement of the indicators of the Strategy - 2050 and the Concept for the transition of the Republic of Kazakhstan to a green economy and will establish technological cooperation and technology exchange with all countries of Central Asia.

interactions in the field of climate change adaptation, technology commercialization and development of technological entrepreneurship, stimulated and supported at the level of regional government policies.

The creation of the Central Asian hub of green technologies "Green Climate Hub" will solve the main tasks of the Central Asian countries:

1.      Promoting multisectoral cooperation in Central Asia at the national and regional levels to solve environmental problems.

2.      Establishment of an intersectoral dialogue in Central Asia with the participation of SMEs and the entire business community of countries.

3.      Facilitating the attraction of advanced knowledge, best international practices and technologies in the field of environmental management and sustainable development to Central Asia.

For Kazakhstan, the creation of a Green Climate hub - a territory of innovative activity for green technologies - will bring closer the achievement of the indicators of the Strategy - 2050 and the Concept for the transition of the Republic of Kazakhstan to a green economy and will establish technological cooperation and technology exchange with all countries of Central Asia.

In addition, the Green Climate hub will contribute to the implementation of the Green Bridge Partnership Program, designed to strengthen the "green" economic growth in the region, which was approved in 2012 at the UN World Summit on Sustainable Development "Rio + 20" as an interregional mechanism open to for all parties. At the same time, the main goal of the Green Bridge Partnership Program (hereinafter- GBPP) is to achieve an optimal level of consumption of energy and other natural resources by all countries of the world by the middle of the 21st century.

The development of the Central Asian Green Climate Hub will create significant benefits for the countries of Central Asia and will create new green jobs, find technological solutions for the environmental problems of industrial enterprises in the region, which will subsequently improve the state of the environment of these countries.

This will create in the countries of Central Asia a real practical system for the accelerated promotion of "green" technologies, as a result of which the number of successful commercially implemented "green" technologies and projects will increase, which in turn will increase the added value for the local and regional economy, will allow the integration of the countries of Central Asia in the field of "green" climate technologies.

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