[SINGAPORE] The Republic has inked a carbon credit transfer agreement with Mongolia, paving the way for the city-state to purchase carbon credits from the landlocked country to offset its domestic emissions.
The agreement with Mongolia is the 10th that Singapore has entered into, following similar deals inked with Papua New Guinea, Ghana, Bhutan, Peru, Chile, Rwanda, Paraguay, Thailand and Vietnam.
The bilateral agreement establishes a legally binding framework for the generation and transfer of carbon credits from carbon-mitigation projects aligned with Article 6 of the Paris Agreement.
Article 6 governs rules on the bilateral and international transfer of carbon credits. In accordance with its stipulations, a host country will have to increase its reported emissions by the amount of carbon credits it has transferred to Singapore, to avoid double-counting, or what is known as corresponding adjustments. One carbon credit represents a reduction or removal of one tonne of carbon dioxide equivalent.
“Project developers can leverage this framework to develop high-quality carbon credit projects that are aligned with the Article 6 rule book. Information on the process for authorisation of these carbon credits projects and eligible carbon crediting methodologies under the Implementation Agreement will be published in due course,” said the Ministry of Trade and Industry (MTI) in a media statement on Monday (Oct 6).
It added that Singapore is committed to channel 5 per cent of its money used to purchase credits that have been authorised under the agreement towards climate-adaptation measures in Mongolia.
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The Republic is also committed to having 2 per cent of the correspondingly adjusted carbon credits authorised under this partnership to be cancelled at first issuance. The carbon credits that are cancelled cannot be sold, traded or counted towards any country’s emission targets, and serves as a contribution towards a net reduction of global emissions.
“This collaboration will advance both countries’ climate ambitions by directing financing towards unlocking additional mitigation potential in Mongolia. The carbon-mitigation projects authorised under this (agreement) will promote sustainable development and deliver tangible benefits to local communities, such as creation of jobs, improved access to clean water, enhanced energy security, and reduction of environmental pollution,” read the MTI statement.
The deal was signed by Singapore’s Minister for Sustainability and the Environment Grace Fu, who is also minister-in-charge of trade relations, and Mongolian Minister of Environment and Climate Change Batbaatar Bat.
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Singapore’s Deputy Prime Minister Gan Kim Yong, who is also minister for trade and industry, and his Mongolian counterpart Uchral Nyam-Osor signed the agreement as well.
