Singapore aims to ink carbon credits transfer agreement with first Asean country by end-2025
The city state has signed 5 MOUs to collaborate on carbon credits but none of them have resulted in the signing of a carbon credits transfer agreement yet
[BANGKOK] Singapore is aiming to finalise carbon credit negotiations and ink its first transfer agreement with an Asean country by the end of this year, said Benedict Chia, director-general for climate change at Singapore’s National Climate Change Secretariat on Wednesday (Jul 9).
“We hope that within the next few months, within this year, we will have more Asean countries being able to collaborate with Singapore. We are in advanced discussions with a number of them, including Thailand. So hopefully things can progress,” said Chia, who was speaking at a panel during the Asia Climate Summit organised by the International Emissions Trading Association.
Singapore has signed memorandums of understanding (MOUs) with five Asean countries – Vietnam, Cambodia, Laos, the Philippines and most recently Malaysia – to collaborate on carbon credits.
However, none of these MOUs have resulted in the signing of a carbon credits transfer agreement yet.
It is only when these agreements are signed can the city-state buy carbon credits from the host countries and use them to meet its climate targets, according to Article 6 of the Paris Agreement.
They set out legally binding frameworks and processes for the generation and international transfer of carbon credits.
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Thus far, Singapore has only inked carbon credit transfer agreements with seven countries – Papua New Guinea, Ghana, Bhutan, Peru, Chile, Rwanda and Paraguay.
Unified system for carbon credit trading
While there are no government-to-government agreements yet between Asean countries, industry players in the region are looking to advance regional cooperation on carbon markets, with the establishment of the Asean Common Carbon Framework at the end of last year.
The framework aims to create a unified system for carbon credit trading in South-east Asia, and steps have been taken to finalise governance structures, discuss methodologies and formulate an implementation road map.
Five carbon market associations from Indonesia, Malaysia, Singapore and Thailand are participating in this initiative.
When discussing with potential host countries to collaborate on carbon credits, Chia said that Singapore focuses on three factors: projects that are aligned with the national interest of the host country; the involvement of local partners and businesses; as well as ensuring the local communities benefit.
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