Private finance needs to step up on climate action in 2024 as election year constrains governments: Grace Fu

WITH many countries heading to the polls in 2024, Sustainability and Environment Minister Grace Fu said it would be difficult for these governments to implement more ambitious climate-action plans.

However, the global momentum arising from the United Nations climate-change conference (COP28) in Dubai at the end of last year points to the need for the private sector and industry to step up and fill in this gap.

“There’re really political realities, especially coming after the Ukraine war and the energy security issue (and) inflation. It’s really not easy for governments around the world.

“And when I look around, we’re not (even) talking about (setting a) carbon tax, we’re talking about removing fossil-fuel subsidies. And even that is difficult to do in an election year. So we are realistic. We know that it’s going to be a difficult year ahead for implementation,” said Fu, who was speaking on Monday (Apr 15) at the Ecosperity sustainability conference organised by Temasek.

Fu and her fellow panellist Mindy Lubber, chief executive officer of Boston-based sustainability non-profit Ceres, were asked whether 2024, deemed to be a historic election year, would impede or accelerate decarbonisation efforts.

Major economies around the world, including the United States, United Kingdom and India, are heading into elections this year; some analysts believe the polls would have a game-changing impact on the direction that climate action would be headed.

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Indonesia recently concluded its general election, with the victory of former defence minister and army general Prabowo Subianto.

South-east Asia’s largest economy is among several in the region that subsidise fossil fuels.

While not referring to any specific countries, Fu said that such policies go against the economics of substituting fossil fuel-based energy systems with renewable ones.

In view of the political realities, Fu added that Singapore will work with private-sector partners to activate private, philanthropic, as well as catalytic finance to pool capital needed for the energy transition.

“So I think our biggest task this year is to put climate back on the agenda, back to the attention of governments around the world, even as there are so many distractions ahead of us,” she pointed out.

Specific to the US, Lubber said that the country’s approach to climate change would regress if former president Donald Trump were to be elected again.

Trump had tried to pull US out of the Paris Agreement while he was in his first term, a moment which Lubber, an American, described as “embarrassing”.

She said, however, enough support for the global imperative to address climate change has been mustered up. For example, the Inflation Reduction Act, a US$369 billion subsidy programme which has jump-started clean-energy investments, would survive, whichever candidate wins the race to the White House.

“But I have no doubt that despite the economic imperative, and despite the progress we’ve made in red states and blue states – and I’d like to believe that much of it will go forward – there’ll be pieces of climate change (policy) that are poised to be on the chopping block.” She cited those on the environment and pollution controls as examples.