Key Takeaways From Futureproofing Cities To Avoid Atlantis

By Dawn McGregor 24 May, 2022

Hard truths, disconnects & next steps on coastal protection & adaptation fund raising for the water & finance sectors were discussed at the CWR event at SIWW 2022. Get on top of what the experts said with our key takeaways

PUB's Director of Coastal Protection set the scene perfectly for our event with an overview of SG's coastal threats mngmt & laid out the hard truths like the significant $$
Limited finance limits adaptation options – for transformative resilience turbo charge adaptation fund raising, do responsible stress testing & get private sector more involved
Event was a wake up call plus, worrying disconnect on operating parameters highlighted; but good news is that cities incl. New York are taking action; it's time for a master vision

We couldn’t have opened our seminar, “Futureproofing Cities to Avoid Atlantis – Evolving Finance for Adaptation Solutions”, at Singapore International Water Week 2022 any better than with Hazel Khoo, Director of the Coastal Protection Department at PUB (Singapore’s National Water Agency). She set the scene in Singapore and laid out hard truths about sea level rise – the massive & long-term commitment required, the need for studies to better understand local challenges, the need for flexible no-regret adaptation strategies and the substantial capital outlay that will be needed. See what Khoo said exactly in box below.

PUB’s Hazel Khoo Setting the Singapore Scene & Laying Out the Hard Truths About Sea Level Rise


“Sea level rise poses an existential threat for low lying nations and Singapore is not spared. About one third of our land is less than 5 meters above the current mean sea level and the Centre for Climate Research Singapore has projected that climate change could cause mean sea level to rise by up to 1 meter by the end of this century. This means that sea levels could be as high as 4 – 5 meters when extreme coastal storm surges coincide with high tides… We are not taking any chances and will treat coastal protection with utmost seriousness

…Adaptation pathways will support near term decision making to implement no-regret measures while identifying future options available should there be a need to adapt to even higher sea levels. And while Singapore is small, our highly varied land use means that we cannot apply a one-size-fits all solution everywhere…

…Coastal protection is a long-term endeavour… And this is what Singapore is committed to, not only study and understand our risks and put in place measures but to also provide a financial environment where we can do all this sustainably.”

-Hazel Khoo, Director of Coastal Protection Department at PUB (Singapore’s National Water Agency), SIWW 2022

Since its inception, SIWW has focused on urban water solutions and the latest technology & innovations. Last year however, coastal protection and sea level rise was injected into the agenda and this year there was even more on the topics.

More focus on SLR but financing coastal protection was still sorely missing from agenda

However, one aspect sorely missing is how coastal protection solutions are going to be financed, especially as we need billions of dollars. As Khoo said, “The [Singapore] Prime Minister mentioned at the National Day rally in 2019 that coastal protection infrastructure in Singapore could cost up to 100 billion dollars or even more over the next 50 to 100 years.” We wanted to kickstart this conversation and so brought finance to the table with our event (see details on panels and panellists in box below).

But to really make headway, finance needs to be talking to people who understand what the science says and who are working on coastal protection solutions, which are mostly being led by cities. Accordingly, the second panel had just those people (see box below).

Futureproofing Cities To Avoid Atlantis: Evolving Finance For Adaptation Solutions

  • Panel 1 – Evolving finance – from stress testing to closing gaps in adaptation finance
    • Citibank, Japan Financial Services Agency, Manulife Investment Management Asia, Moody’s
    • Panel 2 – Waterproofing cities – achieving transformative resilience
      • IPCC Co-Chair of AR6 WG2, Link REIT, Ramboll Group, NYC Economic Development Corporation

Event was a wake up call for both water & finance sectors

The event was a wakeup call for both the water and finance sector. “Put your hand up if you are from the finance sector?” we asked to open the first panel, to which no one in the audience raised their hand. Our next question, “Who here wants to see the finance sector play a larger role when it comes to adaptation finance?” to which everyone in raised their hand; clearly there is a disconnect. More on how water needs to cross-pollinate and invade other sectors in our overall SIWW 2022 Key Takeaways article.

cwr-siww-joint-event-2022-key-takeaway v2

Below are 5 key takeaways from our event and some panel highlights that will hopefully jumpstart more conversations like the one we had and help fast-track action since time is ticking. You can watch the full event on the SIWW+ platform here.

1. It is a marathon, not a sprint and we’re going to need a lot of money for the marathon

  • “Coastal protection is a long-term endeavour……to ensure that we can afford the substantial capital outlay, [the Singapore] government has established a dedicated fund for coastal and flood protection in 2020 and this comes with an initial injection of 5 billion dollars. This fund will be complemented with other financing tools such as borrowing under the Significant Infrastructure Government Loan act or Singa. The first Singa bonds were launched by Singapore’s central bank in September 2021 to finance major long-term infrastructure including coastal and drainage infrastructure in and we will also be exploring tapping into green bonds to finance our projects.”, Khoo

2. Limited finance limits adaptation options – for transformative resilience turbo charge adaptation fund raising

  • “What we don’t actually also sometimes realise is that finance could limit the amount of adaptation options that we have but also how well we manage water and how well we actually plan adaptation is also going to trigger systemic shocks across global financial systems. So, in that way, going forward climate change, water risks and also adaption with the financial sector is going to interlink the financial industry as well as the water industry and everyone working in coastal protection very tightly together.”, Debra Tan, CWR, Head & Director
  • “… the world is late to the adaptation game… the fact of the matter is that we live in a world where we already have global warming of 1.1ºC and quite frankly the science is really clear, we live in an extremely dangerous world, right here, right now we don’t need any further warning to create a dangerous world…”, Dr Debra Roberts, IPCC Co-Chair Working Group II

3. Don’t know the answers yet as still early stage in adaptation finance but need to align with others to avoid using different operating parameters

  • “No one really knows the answer here, this is still early stages when it comes to adaptation.”, Dharisha Mirando, CWR, Finance Engagement Lead
  • “…to be clear, the scenarios that the previous [finance] panel was talking about was really 1 meter of sea level rise. So, the financial industry is doing it to 1 meter but the actual city planners are pitching much higher than that. The other day we heard Singapore saying at least 5 meters above sea level for critical infrastructure.”, Tan
  • “We are right now working on how to develop a certain set of data for analysing physical risks and the goal is to incorporate certain elements of tipping points as part of the plan but at the same time because the scenario development is based on certain global collaboration with climate science, so tipping points discussion is not scientifically fixed unfortunately.”, Satoshi Ikeda, Chief Sustainable Finance Officer, Japan Financial Services Agency

4. Need to get private sector more involved – only 7% of climate finance is on adaptation & most from public sector

  • “At the end of the day, the private financial sector holds the key to financing the transition to a low-carbon economy.”, Dr Siddharth Tiwari, Bank for International Settlements, Chief Representative for Asia and the Pacific
  • “We were just looking at adaptation finance and who can actually fill the gap. And I think its clear that with the gap between adaptation financing needs and global funding sources, the private sector does need to step up and close that gap. Because over the years advanced economies have been providing quite a bit of bilateral support to developing markets but with the pandemic the advanced economies themselves are fiscally constrained and can’t provide as much as support as they have in the past. And while the multilateral development banks have also been providing support and playing a critical role, their commitments are also not sufficient to meet those needs and so the only things left is the private sector.”, Anushka Shah, Vice President, Sovereign Risk Group, Asia Pacific, Moody’s

5. It’s a master vision not a master plan for cities – plenty of opportunities but need to be realistic even if that means abandoning areas

  • “With accelerated threats master plans may not be the right thing to do… Maybe it’s not having a masterplan but a master vision… a vision that is low-regret or no-regret vision…”, Tan
  • “Right now we are starting to see the real estate sector open up to these issues of climate change, flooding and so forth.. for real estate it has always been about location, location, location and you know beach front, ocean front properties are perhaps the most valuable. And going back to your question, does this mean that ocean front properties, we can’t have these any more? The answer in my option the answer is actually no. It’s a matter of understanding the mitigation and adaptation measures that are available, what can you put in place…”, Dr Calvin Kwan, Head of Sustainability & Risk Governance, Link Asset Management Limited
  • “We are creating land use and development frameworks where we acknowledge that some parts of the city are areas that should not experience future growth, that is doesn’t make sense and in some areas in the city we have voluntary buy out programmes for property owners…”, Elijah Hutchinson, Vice President, NYC Economic Development Corporation
  • See more in Panel 2 spotlight box below

Panel 1 & 2 Spotlights

Given the insightful discussions during the event and that water and finance urgently need to talk to each other more, we have shared key points from the two panels in the spotlight boxes below with the hope that they help ramp up conversations like we had at SIWW.

Panel 1 Spotlight: Responsible Stress Testing

“For finance to play a role here, it needs to start seeing the risks. The issue with climate change is that you think there is insurance, it’s fine so if I am a bank, I will be ok, if I am an in investor, I will be ok but the problem is that insurance might not be around forever for some of these risks because as you mentioned it is happening over and over and over again. So, for finance to act and to do anything about, to see these risks we need to see real stress tests. We’ve seen this because as Siddharth mentioned central banks, NGFS, BIS are pushing for this, and Debra mentioned the HKMA and the results that almost 30% of Hong Kong’s loan book could be affected because of climate risks. But these stress tests have to be done responsibly.”

-Dharisha Mirando, CWR. Finance Engagement Lead

“…when we look at traditional stress testing approaches and what we are doing in climate, I think what we have got right is the duration, so a lot of the scenarios we are doing are long dated, obviously which comes with its own challenges on how robust those assumptions are…

…what we probably need to appreciate is that what we are all doing is doing scenario analysis and the real stress testing is slightly different. For example, should we be incorporating tipping points into stress tests because scenario analysis, RCPs don’t take into account tipping point so those are the kind of things we need to work on but I think we are making slow and steady start…”

– Dr Mayank Kaul, Citibank, MD & Head of Real Estate Risk, Asia Pacific, Europe, Middle East & Africa

“By the time that we are talking about stress testing we are already kind of implying climate change scenarios and it is important to recognise the inverse relationship between the mitigation scenarios and adaptation scenarios. So, already when we are talking about, even if we just make it simple 1.5°C, 3°C, 4°C scenarios, you can’t just run one climate scenario, what we really need to do is mitigate to 1.5°C and plan to adapt to 4°C. So, already talking about two different scenarios and what we are doing in practice, in the real world is mitigating to something well above 2°C and adapting to essentially nothing. So, that should be really really alarming because it’s… guaranteed failure…

… I think in practice that there is a lack of understanding usually about that relationship between the inverse scenarios and then the planning for it because there is also a different timeframe. So, in order to hope for the best but plan for the worst we really have to take action really before 2030 to mitigate climate change but then we need to be planning for adaptation out to 2100.”

-Eric Nietsch, Manulife Investment Management Asia, Head of ESG, Asia


Panel 2 Spotlight: Not A Master Plan But A Master Vision for Cities

“New York city doesn’t really have a masterplan, we have a land use framework, we have building code, ordinances… a part of that is that we need flexibility, we have to acknowledge that there is a lot we don’t understand about the future and often a master planning process will set in stone something that doesn’t actually benefit anyone to set something so fixed…

…it’s something we should be continuously revisiting as we are learning about the climate data and information, 2050 and 2100s maybe isn’t enough to think about this problem. We used the conservative projects from the IPCC in our infrastructure design the 90th percentile but when we are talking about these several meters and the Arctic rapid ice melt scenario there is no planning context for that in New York and what the IPCC recommended was not to use that for planning…

…6 ft or 2m of sea level rise [New York sea level rise planning] and in those conditions we have not only significant flooding from coastal storm surges because we experience North Atlantic hurricanes, we have regular tidal flooding…”

-Elijah Hutchinson, Vice President, NYC Economic Development Corporation

“With accelerated threats, master plans may not be the right thing to do…

…Maybe it’s not having a masterplan but a master vision… a vision that is low-regret or no-regret vision…”

-Debra Tan, CWR, Head & Director

“Cities don’t exist in a vacuum, so when we’re talking coastal protection, we are looking at coastal cities, the inland does not exist in a vacuum of the coast… so if you’re talking about protecting the coast and you are saying yeah, that’s easy, let’s just build a big fat wall 2 meters high… great, ok, fantastic you’ve done that but oh oops next year you have a massive inland flash flood because you have not planned for that so, what we are talking about now is you can’t go with the traditional way of working…

… what we are asking for and what we are also recommending going forward as solution providers as engineers and working with these cities is hey, hey, hey take a step back, I know we don’t have time but we do need to look at this planning… a collaborative approach is the only way…”

-Pritha Hariram, Ramboll Group, Head of Water


The good news is that we’ve kickstarted a conversation, now need to roll up our sleeves

And to wrap, I’ll use the words of CWR’s Tan, “The good news is that we are all in this room here, we’ve kickstarted a conversation with the financial industry, we are all on the same table, three very traditional industries [property, finance & water] have actually moved onto the same table so we hope that this kind of conversation can continue but I think that all of you need to invade each other’s sectors more, learn each other’s languages so that we can actually progress this faster and we need to do this now. The actual implementation can be step-by-step… we all need to roll up our sleeves and get on with this as it is not going away if anything it’s only getting worse.”

Further Reading

More on Latest

  • Water Leaders Summit 2022 – Key Takeaways – From net zero water to sea level rise and floods to droughts, see what the world’s water experts had to say on tackling these challenges at the Water Leaders Summit 2022
  • SIWW 2022 – 3 Key Takeaways – CWR was the thematic partner for Singapore International Water Week 2022. See what kept us very busy & our key takeaways from the event
  • A Conversation with Dr Debra Roberts, Co-Chair of IPCC’s AR6 WGII – What does ‘water’ mean to the Co-Chair of IPCC AR6 WG2 report? From impacts to hotspots for change, see what Dr Debra Roberts had to say at the SIWW 2022 on how humanity’s climate change response must overcome our limitations
  • A Conversation with Tom Mollenkopf, IWA President – What needs to be done in water community in a changing climate? The president of the renowned global water organisation IWA, Tommy Mollenkopf, shares his experience and view on the challenges the water sector at SIWW 2022
  • A Follow-Up Conversation with SIWW’s Ryan Yuen – It was an exciting SIWW 2022 with face to face discussions & new topics. We sat down with Ryan Yuen, the man who makes SIWW happen to get his thoughts & a sneak peak on what’s in store for the next event
Dawn McGregor
Author: Dawn McGregor
Dawn leads CWR’s work to help corporates navigate increasingly disruptive & material risks from water & climate threats, as well as transitional risks in the supply chain arising from new regulations in China. Here, Dawn engages extensively with the global fashion industry delivering on-ground workshops in China to keynotes and strategic input at European HQs. She has written at length on the end of dirty and thirsty fast fashion and her report to overcome gaps between brands and manufacturers for a clean and circular future inspired the industry to create a new wastewater tool. Dawn also works closely with the property and tourism sectors where she not only conducts strategic assessments of their exposure but builds collective action toward resilience via closed door working groups and invite-only events. Having helped build CWR, Dawn is a frequent keynote, panellist & moderator at events, including being twice selected as the lead-rapporteur at World Water Week. Her articles are cited in various industry publications including the UN’s ‘World Without Water’. Dawn previously worked in a global investment bank assessing geo-political risk, crisis management and business resiliency. She was born and bred in Hong Kong and has lived in France, England, Singapore and Beijing.
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