For the past two years, the Covid-19 pandemic has been what has driven the predictions and expectations for society and business. Now the Russian-led war in Ukraine has become the force shaping our immediate future, with multiple impacts on global energy markets, gas prices and food supplies.
The conflict has prompted countries to secretly exploit fossil fuel resources as a means of reducing reliance on Russian exports. At the same time, the war also helped establish the shift towards more efficient and cleaner energy supplies to move away from fossil fuels entirely.
It has also led to spiraling gas prices and a food crisis caused by disrupted supply chains, which will in turn affect how consumers choose to spend their money over the next twelve months.
After the conflict that stirred the markets, Eco-Business concludes six trends that could affect global sustainability in 2023.
1. Asia as a key supplier of fossil fuels
Russia, the world’s largest fossil fuel exporter in 2021, has thrown global energy markets into turmoil with its invasion of Ukraine. In the new year, Europe can finally turn to Asia for its energy supply, which will exacerbate the demand of coal, oil and gas producing countries in the region such as Indonesia, Vietnam and Malaysia.
The surge in demand for dirty energy will increase its price in Asia. “With an increasing dependence on fossil fuel imports, the Asean region will face serious energy security challenges, as the availability of energy sources at an affordable price could be jeopardized,” said Beni Suryadi, manager of power, fossil fuel, alternative energy and Storage department at Jakarta-based energy think tank Asean Center for Energy.
Fuel markets have proven to be highly sensitive to crises, such as global pandemics and geopolitical conflict, he added.
However, the war has highlighted the need for nations to achieve energy independence, or they may fall victim to unpredictable supplies and prices affected by political developments, Suryadi said.
The effect of the war on the global green energy transition remains to be seen. On the one hand, some countries may take the opportunity to support renewable energies such as solar and wind to ensure energy security. On the other hand, many developing countries also lack ready infrastructure to facilitate this transition.
As such, the just energy transition partnerships launched at the G20 summit, where Britain, the European Union and the United States agreed to support a new public and private finance package to help Southeast Asian economies reduce reliance on coal power, could be disabled.
2. Back to Asia for minerals that push the world clean energy
Russia is also one of the world’s largest suppliers of high-grade nickel, an important component of lithium-ion batteries found in electric cars.
Although European nations may be reluctant to turn to strategic rivals such as China for substitute imports, they will be forced to explore developing markets such as the Philippines and Indonesia, even if the regulatory environment is not as mature.
“For mining, threats to natural capital are a key challenge, but labor rights and human rights could also enter the equation,” said Rory Clisby, senior environmental analyst at UK-based research institute Verisk Maplecroft. “As new source countries for minerals are found, companies must put robust environmental, social and governance (ESG) policies in place to ensure that higher levels, or different types of threats, do not tarnish corporate reputations and bring danger.”
3. Hi-tech agriculture, lab-grown meat and regenerative soil
The 26-hectare Kaisheng Haofeng Greenhouse in Dezhou, China is one of the largest hi-tech vegetable facilities in the world. Image: Ridder Facebook page
Pandemic-related labor shortages and supply chain disruptions triggered by the Russian-Ukraine conflict are some of the main factors that have pushed food costs to their highest levels in the past ten years.
As such, the technology used to increase food production at the least cost has gained ground and will carry over the next year.
For example, Philippines-based International Rice Research Institute (IRRI) has been preparing for food shortages by genetically modifying rice to optimize nutrition and yield. It developed Golden Rice, a strain loaded with vitamins to feed more people for less.
In China, the Sananbio conveyor system automates seeding and transplanting in farms. Kaisheng Haofeng, one of the largest greenhouses in the world, plans to populate its nurseries with robots for harvesting and packaging in 2023.
Lab grown shrimp dumplings. Image: Shiok Meats
More hi-tech ways of food production are coming in the form of lab-grown food as Singapore’s Shiok Meats launches its cell-based shrimp and lobster next year, while its main competitor Alt Farm in Hong Kong is “pushing” Wagyu beef, as the Company specializes in 3D food printing technology using chemical processing.
Regenerative agriculture, which refers to farming and grazing practices that reverse climate change by restoring degraded soils, will be another trend in sustainable agriculture this year, said Cherrie Atilano, founder of Agrea, a non-profit , which targets poverty among farmers and fishermen. through education and training.
Farmers usually plant only one crop, a practice that usually depletes the soil’s nutrients. By maintaining and improving soil health, more crops can be planted at the same time.
“At the beginning of the global conflict, we have only one choice, which is to strengthen sustainable growth, sourcing and consumption locally. I see that more people are aware of the increase in food prices, which also encourages sustainable local production as well as more diversification and the farm,” Atilano said.
4. Consumer spending on more sustainable and flexible products
Search results for “food by expiration date”. Image: Taobao Juhuasuan
Customers are coming out of the pandemic and the cost of living crisis, with much lower incomes and even financially secure consumers who want to prepare for impending changes.
Customers can browse through the entire list of “Green Label-certified” restaurants by tapping on the Green Label tile on the Foodpanda app. Image: Foodpanda
“In a tough economic environment, consumers want to make smart financial decisions without sacrificing their quality of life. This goes beyond making budget-friendly decisions to consider how factors such as flexibility, durability and sustainability play increasingly important roles in the value equation”, said Matthew Crabbe, Asia Pacific director of London-based market research firm Mintel Trends.
Lifestyle changes are expected in the coming year, such as consuming less meat, buying near-expiration products or buying ugly, locally grown products because they are cheaper, which will have “ripple effects on consumers’ views on nutrition and Sustainability of food, as well as how they shop in other categories,” he added.
Such habits were evident as early as 2021, when the Chinese shopping site Taobao Juhuasuan launched an online sale of food and household cleaning products that were close to their expiration dates, with discounts of up to 70 percent. About 2.1 million consumers bought nearly expired food through Taobao, according to the company.
Singapore-based food delivery company Foodpanda aims to easily help users identify and support sustainable brands on its platform through its “Green Label” restaurant certification program launched this year. The criteria take into account the restaurants’ efforts in sustainably sourced food, recyclable packaging, waste reduction, food waste, carbon reduction and electricity supply.
Crabbe said: “As the market continues to be saturated with added value claims such as being environmentally friendly, local benefits or free delivery, consumers will become more skeptical and discerning. Claims will be put to the test and the transparency of brands will be evaluated much more strictly, as consumers continue to hold on to the qualities they value most.
5. Reconnecting with local businesses
With so much global uncertainty, there is a larger movement to protect local resources and strengthen local businesses. As the impact of global warming is increasingly felt, more consumers will examine whether global brands take their local commitments seriously.
McDonald’s Spain launched the “Hamburger That Could Not Be”, an empty carbon black that symbolized all burgers and other products that could not be produced due to agricultural losses from the forest fires. Image: McDonald’s Spain
Increased consumer scrutiny of how brands are helping local communities began during the pandemic, but it’s also a reflection of consumers’ changing priorities.
For example, in August this year, McDonalds Spain released a symbolic burger that is an empty box, after a summer in which Spain saw some of the worst forest fires in its history. McDonalds was able to contribute more than US$50,000 in direct aid to Spanish farmers who saw their crops affected by the recent weather by allowing customers to buy a virtual burger through a donation at digital kiosks.
“Consumers instinctively respond to homegrown innovators and brands that stamp their authenticity on the items they produce and sell. ‘Localism’ will come to support communities where the product is manufactured rather than where the consumer is,” said Crabbe .
6. Travelers seeking socially and ecologically conscious tourism
Tourists take part in a tree planting activity in Zambales, Philippines. Image: MAD Travel
The change in consumer behavior will affect the travel industry, with tourists increasingly seeking escapes that create more meaningful impacts on nature and society.
Travel network Virtuoso found in its research in 2022 that younger generations are willing to pay more money for “travel brands and experiences that focus on environmentally friendly philosophies, those that contribute to the local people, and that also support the natural and cultural Preserving heritage”.
“Regenerative tourism”, a term given to a type of experience where travelers are given the opportunity to leave a place in a better state than before, will become more popular among globetrotters.
Social enterprise MAD (Make A Difference) trip to the Philippines brings thousands of tourists to plant trees to reforest the barren mountains of Zambales.
Travelers are also demanding tourism operators to be responsible for their own impact, and look for carbon neutral credentials when booking stays.
Sweden-headquartered booking startup Alight will launch a carbon footprint calculation engine in 2021, offering guests the option to choose from a list of carbon offset projects at checkout.
This story is part of our Year in Review series, which chronicles the stories that will shape the world of sustainability in 2022.
