Singapore’s Role in Global Climate Action: Insights from COP29

In an interview with CNA938’s Asia First, co-hosts Hairianto Diman & Susan Ng, as well as KPMG in Singapore’s Partner and Head of ESG Consulting, shed light Singapore’s position on the COP29 climate conference. 

CNA938: Why is COP or the climate conference so important for Singapore?

Sharad: It is extremely important event not only for Singapore but also for the world. The main theme at COP29 is enhancing ambition and enabling action. The parties are expected to enhance their ambition with respect to climate goals and enable action by increasing their commitment to finance for transition. That's also why this COP is known as a finance COP because we are hoping to mobilise a lot of finance to fund the transition in developing countries. 

It is also an important platform that brings all countries together to build consensus on the shared vision of addressing climate challenges. It tries to also address this through knowledge sharing, developing partnerships and demonstrating use cases of successful examples. 

For Singapore as a small island city state majorly impacted by climate change, rising temperature and sea levels, it is important that we understand and we stand together with the world community on our supply chain challenges, livelihoods and economic impacts of climate change. 

As a responsible member of the global community, Singapore is playing its part to drive policy consensus, evolving technology solutions and facilitating innovative finance, as you highlighted by committing to $500 million of financing for climate causes.

CNA938: Let’s take stock of our green progress. Is Singapore on track in achieving our climate goals so far?

Sharad: Singapore has demonstrated world leadership in terms of waste management, water recycling and circular economic principles. We are respected for that as a city state and have shown strong governance and financial ecosystem. We have also provided a base for leveraging blended finance for driving some climate initiatives and as well as promoting carbon trading. We mentioned Article 6 global carbon trading as well. These can act as catalytic capital to drive energy transition. 

One of the biggest challenges is not necessarily the will or desire to do the right things but making the right financing available for those causes. Singapore can play this important role in making financing available. 

Secondly, Singapore can also act as a test bed for trying new technology solutions like Carbon capture, utilisation, and storage (CCUS) and green hydrogen. These pilot projects are already ongoing in Singapore. 

Technological solutions and innovative financing will essentially help the world community move closer to its goal of restraining climate change and limiting the increasing temperature to 1.5 degree centigrade below the industrialised levels. We are going in the right direction.

CNA938: The centralised global carbon programme about carbon credits has been given the green light. Singapore and Zambia have since seen inked a carbon credit deal. How exactly will programmes like this affect Singapore?

Sharad: It is very important. If you look at Singapore, we are probably one of the few countries which has implemented carbon tax. We are saying that carbon tax can be defrayed, to some extent by buying carbon credits. This is an important message to the world that we are open to bilateral partnerships with countries under article 6.2, and also the passing of article 6.4, which enables trading of carbon credit as a standard that can be traded across countries seamlessly. 

Once we have integrity and confidence in the quality of carbon credits, whichever country they come from, that opens a huge financing channel for putting funds to projects in developing countries which can generate carbon credits. This is valuable as we project that 250 billions of dollars in funding could be channelled towards developing countries for more efficient climate projects. 

Carbon trading is going to be very important for all developed countries who are trying to defray their carbon footprint, as well as nationally determined contributions, which is a binding commitment being given by most countries.

Overall, Singapore stands to benefit quite a lot by standardisation of carbon credit mechanisms.

CNA938: Singapore has pledged 500 million US dollars. This is to accelerate capital flows into green projects in Asia. How much of an impact will this actually have?

Sharad: This is an important first step. The climate cause requires trillions of dollars, and every contribution has its own impact. It can act as a catalytic capital, with Singapore's commitment of 500 million US dollars expected to generate at least 10 times more funding in terms of crowding in investments from institutional and commercial capital.

This will be an important first step to get some of the use cases done, some good benchmarks created, and some momentum in creating those climate and technology projects that can bring about the transformation that we require, as well as move the region. 

We anticipate that time is running out for the world community. All parties: public, private sector and philanthropic organisations have to come together, pull their weight and make the necessary financing available. In that regard, making that half a billion-dollars available from Singapore is a very critical step to encourage the world community to come forward and do their part.

CNA938: Besides pledged funding, how else can Singapore play a significant role among other larger countries? At the end of the day, we always talk about Singapore being a little red dot, but we are quite a force to be reckoned with in terms of climate issues.

Sharad: The Singapore Pavilion is one of the best pavilions, providing a platform for good quality discussions, getting world leaders to talk about the key challenges, and understanding how Singapore can complement the efforts of the world community. We are doing great in terms of helping the world community drive the right policy ideas, look at innovative technology solutions, mobilising financing and creating avenues for people to address the climate hurdles. These are important steps that Singapore is taking. Given our size and presence in the global economy, we are punching above our weight to help the global agenda.

CNA938: Besides pledged funding, how else can Singapore play a significant role among other larger countries? At the end of the day, we always talk about Singapore being a little red dot, but we are quite a force to be reckoned with in terms of climate issues.

Sharad: Apart from carbon markets, financing discussions and big announcements by the Monetary of Authority in Singapore (MAS), energy and decarbonisation of hard-to-abate sectors is a very key theme. We have been talking about broader energy transition in the energy sector, moving from fossil fuel to renewable energy. The important challenge now the world needs to address is: how do we take care of highly polluting industries, hard-to-abate sectors like aluminum, steel process industries, chemical industries, and this is where all the focus is, in terms of creating the best technology solutions, as well as generalising some financing so that the entire supply chain can be made cleaner and decarbonised. These have been a key focus in the discussions at the Singapore Pavilion.