Singapore’s move towards a green economy – What you need to know
Written by: Clare Chong
Minister of Finance Lawrence Wong revealed that Singapore is taking active steps to review the carbon tax to update the upcoming 2022 budget, with 3 major steps to build a new green economy for Singapore in the next 30 years.
The 3 major steps towards a green economy
During his speech in the CNS’s 2021 Singapore APEX Corporate Sustainability Awards Ceremony, Mr. Wong said that the global economy needs to invest about USD$150 trillion over the upcoming 30 years to switch to more sustainable energy sources and reduce carbon emissions. Singapore is trying to move towards this goal in a much faster time frame by putting in place carbon prices and regulatory standards to progressively decarbonise our economy.
The carbon tax is currently being reviewed and will be updated at the budget in 2022 with a plan to roll out standards for equipment appliances or motor vehicles. Prior to this announcement, the government has already stated that internal combustion engine vehicles will be phased out and all vehicles will be running on greener energy by 2040. Businesses will be assisted to move towards sustainability by creating programmes and schemes (e.g. Enterprise sustainability programme).
The last step would be to develop a “robust financing eco-system to support the green transition”. The authorities will lay out a framework and rules to connect to different stakeholders. For instance, the National Environment Agency (NEA) will be establishing a $3 billion Multicurrency Medium Term Note Programme and the Green Bond Framework to finance sustainable infrastructure projects such as the Integrated Waste Management Facility in Tuas. A Green Bonds Programme Office has also been set up to catalyse the government’s green financing options. A market for voluntary carbon credits is also needed as some firms may face challenges in eliminating emissions totally or quickly.