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Getting the green light to mitigate impact of climate change
THE United Nations Intergovernmental Panel on Climate Change (IPCC) recently published its special report on global warming, sending a strong warning both to world leaders and to all of us.
We need rapid and unprecedented changes to our habits if we are to avoid major environmental, economic and social damage. While the timeframe may be narrow, the experts tell us that it is still possible to change course and that we can achieve significant results if we step up our efforts together now. Closing our eyes and hoping for the best or waiting for potential better technologies - which we will also need - is not a responsible course of action.
The ecological, social, and economic impacts of climate change are worsening worldwide. The intensity and frequency of climate disasters have been growing in the last years, and South-east Asia is particularly vulnerable to these catastrophes.
On the occasion of the Singapore International Energy Week, it is decisive to bear in mind that the energy sector is key to the transition to a green and low-carbon economy consistent with the goal stipulated by the Paris Agreement to keep climate change to well below two degrees. In order to mobilise the financial sector, it is also vital to accelerate the greening of finance as this transition requires shifting trillions from carbon-intensive to truly green activities.
In South-east Asia, Singapore is at the forefront of climate action. Regarding power generation, the country has shifted from oil to gas and is progressively developing solar energy. When it comes to energy consumption, Singapore has managed to limit transport-related consumption thanks to visionary policies that favour public transport. It has also taken steps, as the second country in Asia to do so after China, to implement a carbon-pricing mechanism while helping companies that emit the bulk of greenhouse gases (GHG) to reduce their carbon footprint.
We are also pleased to see that Singapore has managed to mobilise its Asean partners during its chairmanship this year. We hope that positive outcomes for an effective implementation of the Paris Agreement will be achieved at the COP24 in Katowice at the beginning of December, with strong support from Asean countries.
With regard to the mobilisation of the financial sector in Singapore, there have been several noteworthy government policy actions and industry-led initiatives that have achieved an increase in the level of awareness among the financial community. Singapore has taken important steps towards kick-starting the domestic green bond market with, for instance, the introduction of a Green Bond Grant scheme by the Monetary Authority of Singapore (MAS) in 2017 to encourage the issuance of green bonds.
At the regional level, Singapore, as the Asean Chair, has put sustainable finance on the Asean 2018 finance agenda. The Monetary Authority of Singapore also signed a memorandum of understanding with the International Finance Cooperation (IFC), a member of the World Bank Group, which underscored the shared objective to work together to accelerate the growth of green bond markets in Asia.
France and Germany are among the leading European countries when it comes to fighting climate change. Our two countries have developed strong policies at home and are eager to help and share their expertise, thanks to their extensive public aid instruments and the capabilities and technologies of their private companies.
Since they are strong supporters of the countries in Asean and around the world, they are also eager to build strong partnerships on renewable energy, GHG emissions in shipping, the circular economy and green finance. One of the pressing challenges now is to embark on this journey with neighbouring countries that still rely heavily on coal for power generation, help them increase their focus on energy efficiency (for buildings, electrical appliances, industrial processes, etc) and invest in green power sources rather than coal power plants that will become stranded assets in a couple of years.
Key initiatives have been launched globally since the Paris Agreement to help stakeholders to share their expertise and scale up their efforts together, such as the International Solar Alliance and the Global Alliance for Building and Construction. Once again, all the Asean countries are most welcome in these alliances.
Ambitious implementation plan
In the transport sector, there is no doubt that Singapore, as a leading player in the shipping industry and as the first bunkering hub in the world, can be a responsible leader by supporting an ambitious implementation plan of the International Maritime Organization (IMO) climate change strategy for shipping.
Bolder action could also be taken with respect to developing a circular economy in order to become truly green. If we reduce our consumption of resources (water, plastic, raw materials, etc) and focus on what is really essential, we will all save money and protect our precious environment.
Regarding green finance, which is the key to channelling investments towards sustainable assets, we are very proud that the MAS, along with Deutsche Bundesbank and Banque de France, were among the eight founding members of the Central Banks and Supervisors Network for Greening the Financial System (NGFS), launched at the Paris One Planet Summit on Dec 12, 2017.
We are convinced that French and German financial institutions - such as banks, insurance companies, fund managers and ESG service providers - can play a decisive role in scaling up green finance in the region. Germany and France would definitely encourage positive commitments and announcements from major Singaporean financial entities on this matter.
We call for a renewed commitment to the Paris Agreement, which is more urgently needed than ever, through rapid and resolute action.
- Dr Ulrich A Sante is the Ambassador of Germany to Singapore. Marc Abensour is the Ambassador of France to Singapore.