KUALA LUMPUR: Within the realm of climate action and equitable development, and in line with the Madani Economy framework, a just transition approach will guide Malaysia moving forward.
According to the 2024 Economic Outlook report released by the Finance Ministry (MoF) today (October 13), this approach holds the promise of harmonising the issues as the nation grapples with the entwined challenges of achieving high-income nation status while managing its natural heritage as well as safeguarding the people.
"Guided by the principles of "Just Transitions" and the Madani Economy framework, Malaysia charts a development trajectory leading to a sustainable future that is comprehensive and environmentally conscious, through the equilibrium between economic growth, climate mitigation and adaptation as well as social justice," the report said.
With Malaysia's growing economy and population, coupled with increasing temperatures in the region, the energy sector will assume the most pivotal role in ensuring this just transition.
In Malaysia's efforts to ensure the fruits of economic growth are distributed equitably across regions and communities, special attention must be directed towards key industries poised to be adversely affected.
Existing energy sector policies, like the National Energy Policy 2022-2040 (DTN) and National Energy Transition Roadmap (NETP), highlight measures to sustain the oil and gas sector while reducing reliance on coal.
"This energy transitional process necessitates the need to support the sector's shift towards a lower-carbon growth model while concurrently minimising workforce implications through comprehensive and continuous upskilling and reskilling programmes within the energy industry ecosystem," the report said.
In strengthening Malaysia's business ecosystem, measures must be accelerated to strengthen Malaysia's industries and businesses to proactively prepare for the Carbon Border Adjustment Mechanism (CBAM) and other similar regulations, such as the EU Deforestation-free Regulation (EUDR), imposed by trading partners.
Meanwhile, as sectors evolve and industries transform, safeguarding the rights and wellbeing of workers becomes paramount besides the need to establish a robust and comprehensive carbon accounting ecosystem to support domestic industries and businesses.
According to the report, Malaysia's strong foundation in economic growth, sustainability, Islamic financing and nature-based solutions, the country possesses the potential to play a leadership role within the region as a climate pioneer.
"As fellow Asean nations embark on their individual low-carbon transitions, collaborative efforts in emissions reduction, renewable energy proliferation, and economic instruments can set the stage for regional climate endeavours," it said. – Bernama