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IPW: New Zealand consults on resilience, and Asian bank aligns with Paris Agreement

11 July 2023

New Zealand outlines proposals for infrastructure resilience, and the Asian Infrastructure Investment Bank announces its new finance will support climate action.

IPW: New Zealand consults on resilience, and Asian bank aligns with Paris Agreement
Climate change is already increasing the severity and frequency of storms in New Zealand. Image credit: Shutterstock

New Zealand proposes strengthening infrastructure resilience

The New Zealand government is consulting on regulatory changes to make the country’s critical infrastructure more resilient.

The proposed changes include:

  • introducing a systems-based approach to infrastructure resilience
  • setting clear and robust minimum resilience standards that are enforceable
  • introducing powers to manage national security risks in New Zealand’s critical infrastructure system
  • setting up a central coordinating agency responsible for establishing policy and regulatory requirements for resilience for the critical infrastructure system

The proposals in the consultation, which closes on 8 August, are based on recommendations from two major reports: the New Zealand Infrastructure Strategy, and the country’s first national adaptation plan.

Climate change is already increasing the severity and frequency of flooding, landslides, storms and droughts in New Zealand.

Meanwhile, the country’s tectonic activity exposes it to a high risk of earthquakes, volcanic eruptions and tsunamis.

As the New Zealand government states, infrastructure owners have typically built and maintained their assets to withstand high-impact, rare events.

However, as recent storms have highlighted, the country’s infrastructure networks have become increasingly dependent on one another – meaning that cascade failure is a growing risk.

The ICE’s view:

New Zealand published its first national adaptation plan last year as it faced up to the growing risks from climate change.

Acknowledging the risk of natural disasters, including putting in place contingencies, is becoming more pressing since the onset of the climate crisis.

Enhancing resilience is a continuous process, where learning is key to creating policies and standards for reducing the impacts of shocks.

As the ICE highlighted earlier this year in a policy paper on climate resilience, infrastructure is an interconnected ‘system of systems’ and it must be managed as such.

It’s encouraging to see New Zealand recognise this and propose a systems-based approach to infrastructure resilience.

Doing so allows countries to better anticipate, absorb, adapt to and recover from large-scale shocks.

Asian Infrastructure Investment Bank announces climate change alignment of new investment operations

The Asian Infrastructure Investment Bank (AIIB) has issued its methodology for assessing the alignment of its investment operations with the 2015 Paris Agreement.

This means that all of the AIIB’s new investment operations will support infrastructure projects that contribute to climate change mitigation, adaptation and resilience.

Specifically, the AIIB’s investment operations will:

  • align with the overall mitigation goals of the Paris Agreement - in other words, be consistent with a low greenhouse gas emissions development pathway and not undermine a transition to a decarbonised economy
  • align with the adaptation goals of the Paris Agreement -this means investments will actively manage climate risks

The AIIB has already committed to ensuring that 50% of its overall approved financing by 2025 will be directed toward climate finance.

This includes prioritising green investments such as renewable energy and public transport, as well as better water management and sanitation.

The ICE’s view:

Asia is already experiencing the extreme effects of climate change, including the blistering April 2023 heatwave that affected the Indian subcontinent and South East Asia.

The continent is home to six of the top 10 countries globally that’ve been most impacted by climate-related disasters in the past 20 years.

Investments from infrastructure banks like the AIIB are structured to leverage revenue streams and crowd-in private sector and institutional investors who are willing to share risk.

Infrastructure is responsible for 79% of all greenhouse gas emissions and 88% of all adaptation costs.

The AIIB lining up its methodology with the Paris Agreement is a step forward in ensuring countries are directing investment into sustainable infrastructure.

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  • David Hawkes, head of policy at ICE