ASEAN member states have agreed to a cross-border carbon credit trading framework at a summit hosted by Singapore, marking a significant step toward regional carbon market integration. The framework enables companies to trade verified carbon offsets across Southeast Asian markets under Article 6 of the Paris Agreement.
Framework Details
The agreement establishes mutual recognition of carbon credit methodologies across ASEAN nations, a common registry for tracking credit issuance and retirement, and standardized verification protocols. Singapore will host the regional registry, leveraging its position as a financial hub. Initial trading is expected to begin by mid-2027.
Market Potential
Analysts estimate the ASEAN voluntary carbon market could reach US$3-5 billion annually by 2030, driven by growing corporate net-zero commitments and Article 6 implementation. Southeast Asia’s vast forest carbon and renewable energy potential position it as a major credit supplier to global markets.
Singapore’s Role
Singapore is positioning itself as the region’s carbon services and trading hub, with multiple bilateral agreements already signed with countries including Indonesia, Vietnam, and Cambodia for carbon credit cooperation. The city-state’s Climate Impact X (CIX) exchange launched standardized carbon credit contracts in 2024.
Source: ASEAN Secretariat, Ministry of Trade and Industry Singapore
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