As the Philippines and ASEAN neighbors face compounding climate risks, regional research proves that shifting from extractive industries to a restorative economy generates long-term prosperity, protects critical watersheds, and shields frontline communities.

BANGKOK, THAILAND – October 13, 2026 – At Bangkok Climate Action Week (BKKCAW) 2026, Indonesian research institutions, organisations, and local leaders unveiled a practical framework for a restorative economy. This model gives Southeast Asia an opportunity to build economic systems that actively replenish ecosystems instead of just extracting value from natural resources.

The agenda is modeled around regional potential and backed by new CELIOS (The Center of Economic and Law Studies) research showing restorative economic practices in neighboring Indonesia alone could generate Rp 2,208 trillion (approx. ₱8 trillion / US$140+ billion) in national economic output over 25 years while cutting income inequality by 15%.

For the Philippines, the model offers an important blueprint. The country is ranked as one of the world’s most vulnerable nations to climate-induced disasters. As national government climate expenditures exceed ₱1.16 trillion annually and adaptation financing needs approach US$100 billion through 2040, the Indonesian sessions demonstrated how community-led nature restoration across 23,470 villages can move beyond isolated projects into mainstream, scalable economic models across Southeast Asia. Convened under the BKKCAW theme “Economy We Shape, Climate We Share,” the program showed how economic activity itself can rebuild natural systems and strengthen local livelihoods.

The CELIOS study reflects the Philippines’ urgent need to address extreme weather hazards across the country. As seen in recent months, the climate crisis has severely impacted Southeast Asia. News of extreme flooding and typhoon damage across Metro Manila, Luzon, and Visayas, and urban inundation in Bangkok and Johor Bahru, alongside destructive forest fires in Sumatra, Kalimantan, and Papua, has filled everyone’s television sets and social media feeds.

From extracting value to restoring value

For CELIOS, the transition requires changes in the way economies raise, allocate, and distribute capital. On October 5, CELIOS joined PINUS Indonesia, The Reform Initiatives, and Publish What You Pay Indonesia for “Building Indonesia’s Green Finance Architecture: From Macro-Fiscal Policy to Inclusive Grassroots Benefit Sharing.”

The speakers for the session, “Building Indonesia’s Green Finance Architecture: From Macro-Fiscal Policy to Inclusive Grassroots Benefit Sharing”.

The session examined how instruments such as Ecological Fiscal Transfers (EFT), ecological and windfall profit taxes can be designed to direct resources toward ecological priorities and local economies.

Indonesia’s experience with Ecological Fiscal Transfers across 43 subnational governments provides one example of how fiscal policy can connect national revenues with environmental performance and local development. The discussion also considered how green finance can reach community-led initiatives and improve benefit-sharing at the grassroots level.

“We must elevate the nature-based economy beyond basic conservation and position it at the center of national economic strategy,” said Bhima Yudhistira, Executive Director of CELIOS. “Through equitable fiscal mechanisms and transparent benefit-sharing, we can attract capital while ensuring transition dividends directly enrich local communities on the frontline.”

Restoration as an economic activity

At the landscape level, Cendekia Iklim Indonesia (CII) explored what a restorative economy looks like when it is built around the ecosystems that sustain local economies. Its programme, “Wealth That Flows: Building Prosperity Through Watershed Regeneration in Southeast Asia,” focused on the relationship between healthy watersheds, livelihoods and local economic activity. A featured session on “Restoring Watersheds through Agroforestry” explored how agroforestry and landscape restoration can support both ecological recovery and rural livelihoods.

The panel for the discussion on “Wealth That Flows: Building Prosperity Through Watershed Regeneration in Southeast Asia”.

The discussion included examples such as coffee and macadamia agroforestry in Doi Tung, where agricultural production forms part of a wider approach to landscape restoration and community development.

CII emphasized that restoring nature is a value-generative investment rather than an ongoing expense. The organization underscored that regenerating watersheds through sustainable agroforestry secures critical water systems, builds rural livelihoods, and constructs a scalable economic playbook for the wider Mekong and ASEAN region.

A Pavilion for Global South Solidarity and Practical Bioeconomy

Organised by Koalisi Ekonomi Membumi (KEM), the Nature-Based Economy Pavilion at Lumpini Park (October 5–7) served as a collaborative hub bringing together social entrepreneurs, impact investors, civil society, researchers, and policymakers from across the Global South.

Rather than viewing climate action in isolation, the pavilion demonstrated how responsible bioeconomy models can connect local producers directly with absorbents, capital, and policy design.

“Climate action strategies cannot operate in isolation; they require active, cross-sector collaboration,” said Fito Rahdianto, Executive Director of KEM. “If dreaming of a better world feels too abstract, we can at least offer a new perspective to imagine life beyond the extractive systems we inherited, building a responsible bioeconomy that creates value from biodiversity while ensuring social and environmental well-being.”

From Nature-Based Solutions to a Restorative Economy  

Across these discussions, the message was simple: restoration can be part of how economies create value, not simply a cost of doing business. From green finance and fiscal reform to agroforestry and watershed restoration, participating Indonesian organisations explored what it takes to build economic models that strengthen both local livelihoods and the natural systems they depend on.

This exploration of ideas aimed to create regional awareness of how restorative economic practices practiced not only at the grassroots level but also at the national and Southeast Asian level will contribute to positive impact for society and the environment.