Opening Remarks by Singapore's Ambassador for Climate Action at the Signing of Singapore Carbon Markets for Development Activity Plan

A Partnership for Carbon Markets and Development

Distinguished guests, ladies and gentlemen.

Welcome to the launch of this new initiative by the World Bank’s Singapore Carbon Markets for Development Programme.

Much of the world’s mitigation potential lies in developing countries. Carbon markets can channel the finance necessary to realise this potential.

• Carbon markets lower the cost of global decarbonisation, by directing capital to where a tonne can be cut most cheaply.

• They make mitigation projects commercially viable, by turning emissions cut into revenue earned.

• For governments with stretched budgets, there is a further virtue. A carbon credit is not a loan.  A buyer pays for emissions reduced.  The revenue follows results. It does not sit on the sovereign balance sheet.

• Most of all, carbon credits support livelihoods. Carbon finance is not only climate action. It is sustainable development, delivered where people live.

But carbon markets are not working as well as they should. Three practical problems stand in the way.

• First, market infrastructure remains weak and fragmented in some countries.

• Second, projects struggle to secure financing, especially those that are small and dispersed.

• Third, many developing countries still lack the capacity to participate effectively.

These are the gaps that the Singapore Carbon Markets for Development Programme was set up to close.  

Launched by the World Bank and Singapore earlier this year, its purpose is simple: to help developing countries build the infrastructure and capabilities they need to participate effectively in carbon markets.

Today, we take the next step. We are signing an Activity Plan for 2027 to 2029.

Three years. Three pillars. Three problems to solve.

PILLAR 1: CARBON MARKETS INFRASTRUCTURE

The first problem is weak and fragmented market infrastructure.

• A country cannot participate effectively in carbon markets without clear rules, reliable registries, and credible systems to measure emissions reductions.

• No registry, no trust. No trust, no buyers. And building these systems from scratch is difficult and expensive.

Think of a registry as the ledger, and digital monitoring, reporting and verification, or dMRV, as the evidence.

• The registry records, tracks, and transfers carbon credits.

• dMRV generates the reliable emissions data that stands behind every credit. Well-designed dMRV can lower transaction costs, improve data accuracy, and make verification faster.

The Activity Plan will help to build both registry and dMRV capabilities.

• A Carbon Registry Toolkit is already under development.  It will provide practical templates and guidance on governance, legal foundations, data standards, and technical architecture, to help countries design and operate national registries.

• The Activity Plan will extend dMRV to emerging project classes that are critical for future carbon markets: regenerative agriculture, blue carbon, and community-based clean energy.

PILLAR 2: CARBON FINANCE

The second problem is financing.

• Carbon revenue comes only after emissions have been reduced and credits issued. But projects need finance before they can start.

• Small and dispersed projects face a further hurdle. High transaction costs can make them unviable.

Aggregation is one answer: bring smaller projects together into larger portfolios.

• It spreads transaction costs across many projects, and creates opportunities big enough to attract investors and buyers.

• Aggregation simplifies access for buyers, and makes a portfolio of projects more investable.

The Activity Plan is developing and testing ways to aggregate projects and credits, at country and sector levels.  We are already putting this into practice.

• Under the Programme, we helped establish the Bhutan Climate Fund, which targets US$25 million, with a pipeline of some 4.6 million tonnes of carbon credits.

• We also developed the design of the Banco do Brasil Carbon Fund, to provide upfront financing to forestry and agricultural projects against the credits they will generate later. Viable projects can get off the ground sooner.

PILLAR 3: CAPACITY BUILDING

The third problem is capacity.

•        Carbon markets need rules, institutions, technical expertise, and people who know how to put them into practice.

•        Rules need regulators. Registries need operators. Markets need people who know how to run them. Many developing countries are still building these capabilities.

The Activity Plan will help countries strengthen their carbon market policies and institutions.

• We have already laid the groundwork with Nanyang Technological University for a Knowledge Academy, where policymakers receive practical training and engage in peer learning.

A PARTNERSHIP THAT WORKS

The World Bank and Singapore bring complementary strengths to this fruitful partnership.

• The World Bank brings deep technical expertise, global reach, and strong relationships with developing countries.

• Singapore brings experience in carbon pricing and Article 6, a strong financial ecosystem, and our role as a convenor.

Our aim is simple. We want to make carbon markets work better.  That means:

• building the infrastructure that gives buyers confidence;

• creating the financing that lets projects get off the ground; and

• giving countries the capabilities to participate effectively.

Over the next three years, we will move from developing solutions to testing and scaling them.  And when we do that, carbon markets will unlock more finance and enable more projects.

But the true measure of a carbon market is not the credits it trades.

It is the tonnes of carbon emissions it cuts.  And the livelihoods it lifts.

And that is what this Activity Plan we are signing is all about.

Thank you.