Harvard Case - Clearing the Air: Responding to the Southeast Asian Transboundary Haze Crises of 2013 and 2015
"Clearing the Air: Responding to the Southeast Asian Transboundary Haze Crises of 2013 and 2015" Harvard business case study is written by Hong Meng Khoo, Wee-Kiat Lim. It deals with the challenges in the field of International Business. The case study is 27 page(s) long and it was first published on : Aug 29, 2018
At Fern Fort University, we recommend a multi-pronged approach to address the Southeast Asian transboundary haze crises, focusing on international collaboration, sustainable land management practices, and robust enforcement mechanisms. This approach prioritizes environmental sustainability while fostering economic growth and regional stability. We believe this strategy will effectively mitigate the haze problem, improve public health, and promote long-term economic prosperity in the region.
2. Background
The case study 'Clearing the Air' examines the recurring transboundary haze crises in Southeast Asia, specifically the events of 2013 and 2015. These crises, primarily caused by agricultural burning in Indonesia, have had devastating impacts on neighboring countries like Singapore and Malaysia, leading to severe air pollution, health issues, and economic losses. The case highlights the complex interplay of factors contributing to the haze, including international business, globalization, emerging markets, government policy and regulation, and corporate social responsibility.
The main protagonists are the affected countries (Singapore, Malaysia, etc.), Indonesia, and various international organizations like ASEAN and the World Bank. The case study explores the challenges of coordinating a response across borders, balancing economic development with environmental protection, and navigating the complexities of international relations and multinational corporations (MNCs) operating in the region.
3. Analysis of the Case Study
Analyzing the case through a strategic framework, we identify several key issues:
- Lack of Regional Coordination: The absence of a unified regional response hampered effective crisis management. Individual countries acted independently, leading to conflicting policies and inefficient resource allocation.
- Economic Drivers of Deforestation: The case highlights the economic incentives driving land clearing for palm oil plantations and other agricultural activities. This highlights the need for sustainable land management practices that balance economic growth with environmental protection.
- Weak Enforcement Mechanisms: The lack of robust enforcement mechanisms in Indonesia, coupled with limited international cooperation, allowed illegal burning practices to persist.
- Public Health and Economic Impacts: The haze had significant negative impacts on public health, leading to respiratory problems and other health issues. The economic impact was felt across sectors, including tourism, aviation, and agriculture.
4. Recommendations
To address the transboundary haze crises, we recommend the following:
1. Strengthening International Cooperation:
- Establish a Regional Haze Task Force: This task force, comprising representatives from all affected countries, would coordinate a unified response, share information, and develop joint strategies.
- Develop a Regional Haze Agreement: This agreement would outline clear responsibilities, enforcement mechanisms, and financial support for sustainable land management practices.
- Promote Cross-border Cooperation: Encourage collaboration between affected countries and Indonesia in areas like fire prevention, monitoring, and information sharing.
2. Sustainable Land Management Practices:
- Promote Sustainable Agriculture: Encourage the adoption of sustainable agricultural practices, such as zero-burn methods, agroforestry, and responsible palm oil production.
- Invest in Reforestation and Restoration: Support programs for reforestation and restoration of degraded lands, particularly in areas prone to fires.
- Develop Economic Incentives: Provide financial incentives and technical assistance to farmers and companies adopting sustainable practices.
3. Robust Enforcement Mechanisms:
- Strengthen National Laws and Regulations: Indonesia should strengthen its laws and regulations regarding land clearing and burning practices, including stricter penalties for violators.
- Improve Monitoring and Surveillance: Enhance satellite monitoring and aerial surveillance capabilities to detect and respond to fires promptly.
- Establish a Regional Enforcement Body: Consider establishing a regional enforcement body with the authority to investigate and prosecute violators of the haze agreement.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: The recommendations align with the core competencies of international organizations and governments in promoting environmental sustainability, economic development, and regional stability.
- External Customers and Internal Clients: The recommendations address the concerns of affected countries, businesses, and citizens, while also considering the needs of Indonesian stakeholders.
- Competitors: The recommendations aim to create a level playing field for businesses operating in the region, promoting fair competition and sustainable practices.
- Attractiveness: The recommendations are economically attractive as they promote long-term economic growth, reduce health costs associated with haze, and enhance the region's attractiveness for investment.
6. Conclusion
The Southeast Asian transboundary haze crises are a complex challenge requiring a multi-faceted approach. By strengthening international cooperation, promoting sustainable land management practices, and implementing robust enforcement mechanisms, the region can effectively address the haze problem, improve public health, and foster sustainable economic growth.
7. Discussion
Alternative solutions include focusing solely on technological solutions, such as developing advanced fire suppression technologies, or relying on market-based mechanisms, such as carbon trading. However, these solutions are less effective in addressing the root causes of the haze, which are driven by economic factors and weak governance.
The recommendations are based on the assumption that governments and international organizations are committed to addressing the haze problem. However, there is a risk of political resistance and lack of funding.
8. Next Steps
To implement these recommendations, the following steps are crucial:
- Phase 1 (Short-Term): Establish the Regional Haze Task Force and develop the regional haze agreement. Implement immediate fire prevention measures and provide emergency assistance to affected countries.
- Phase 2 (Medium-Term): Promote sustainable land management practices through financial incentives, technical assistance, and capacity building programs. Strengthen national laws and regulations related to land clearing and burning practices.
- Phase 3 (Long-Term): Establish a regional enforcement body and develop a comprehensive monitoring and surveillance system. Promote regional economic development initiatives that prioritize sustainability and environmental protection.
By taking these steps, Southeast Asia can effectively address the transboundary haze crises and build a more sustainable and prosperous future for the region.
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Case Description
Over 26 consecutive days from September to October, the transboundary haze of 2015 lingered in Southeast Asia. For Singapore, this episode was one of the city-state's worst and most protracted pollution. The fires originating mostly from Sumatra and Kalimantan in Indonesia, produced more greenhouse gases each day than the emissions by the entire U.S. economy. They rendered two million hectares of land barren, incinerating forests, oil palm and pulpwood plantations alike. This was a repeat of the haze pollution two years earlier. How did Singapore, Indonesia, and Southeast Asia as a whole respond to the haze pollution of 2013 and 2015? What did different segments of society do to cope with the pollution? What could companies like Asia Pulp & Paper (APP) that had sizeable stakes in plantations across Indonesia do to improve their operations and public reputation? This case highlights the multifaceted sustainability challenges encountered in the quest for environmental protection and the resolution of transboundary haze in Southeast Asia. The haze is an annual phenomenon; its effects are exacerbated by destructive agricultural practices, climate conditions, inadequate legislation, weak environmental activism and intergovernmental cooperation, and a lack of consumer action. To date, it remains an intractable problem.
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