SINGAPORE - Singapore is reviewing its carbon tax level, and the outcome will be announced by the Ministry of Finance at this year's Budget, said Minister for Sustainability and the Environment Grace Fu on Tuesday (Jan 25).
Singapore was the first South-east Asian nation to introduce a carbon tax from 2019 to 2023, but its rate of $5 per tonne is considered to be on the low end of the spectrum.
Aside from unveiling the revised rate for 2024 on Feb 18, the Government has also said it will provide indications on what to expect up to 2030, so businesses have time to adjust.
Speaking at the 6th St Gallen Symposium Singapore Forum held at the National University of Singapore's (NUS) Shaw Foundation Alumni House, Ms Fu said the Government and its agencies would support companies to be among the best globally in circularity, energy and carbon efficiency.
The carbon tax was introduced as an incentive to reduce emissions across all sectors and aid the transition to a low-carbon economy.
"The carbon tax, like a coin, has two sides - one side is to put an explicit cost on producers of CO2 (carbon dioxide) for its environmental impact, and the other is to help companies to decarbonise through incentives that the carbon tax will fund," said Ms Fu.
"To help companies transit, they can tap incentives and grants by investing in production processes and equipment that will, for example, increase energy efficiency, or to capture carbon."
Longer-term efforts to scale up decarbonisation have seen Singapore partner companies and researchers to explore emerging low-carbon technologies.
Oil giant Shell, for example, has signed a $4.6 million research agreement with NUS, supported by the Economic Development Board (EDB) and the National Research Foundation, to develop novel ways to convert CO2 into cleaner fuels and useful chemicals.
The theme of Tuesday's forum was "collaborative advantage", which a panel later discussed in detail.
EDB managing director Jacqueline Poh said that while many believe fossil fuel firms should not play a role in the sustainability solution, excluding them would be "a great disservice to the amount of ground" that needs to be covered.
"It's precisely some of the companies such as Shell, such as Exxon, who have been deep into the space of energy production; who might be best placed to find a solution to issues such as carbon capture and storage and utilisation; who might be best placed to be looking at energy efficiency; might be best placed to be looking at hydrogen and other biofuels," she said.
HSBC Singapore chief executive Wong Kee Joo gave the example of the banking sector, which may have started out viewing fintech firms as rivals, only to realise that both could work together to develop solutions.
The Straits Times editor Warren Fernandez, who is also editor-in-chief of SPH Media Trust's English, Malay and Tamil Media Group, warned of what he saw as forces driving and splitting societies in the opposite direction, away from collaborative advantage.
"We hear about polarisation in society, where the extremes are louder than the centre and the centre is struggling to hold. We hear about social bubbles and echo chambers," he said. "The question, I think, for all of us - as business leaders, as community leaders, as parents, as individuals - is: What can we do to overcome that atomisation of society?"
During her speech earlier, Ms Fu outlined Singapore's collaborative strategies in sustainable development, including its Green Plan 2030 - a national movement to nudge the city-state towards its net zero emissions goals.
Singapore also actively supports and prompts international cooperation, including through global fora like the 26th United Nations Framework Convention on Climate Change in Glasgow last year.
There, Singapore and Norway co-facilitated ministerial negotiations on Article 6 of the Paris Agreement - which centres on how countries can reduce their emissions using international carbon markets - and helped to finalise the rulebook on these markets.
Ms Fu also pointed to efforts to consult and co-create environmental solutions with Singaporeans, such as citizens' workgroups that have led to pilots in the likes of transparent recycling bins.
A $50 million SG Eco Fund to encourage ground-up initiatives has also awarded 79 individuals and community groups with nearly $4 million to implement their ideas.
Ms Fu said that as at December last year, the Government has engaged more than 25,000 companies, youth, non-governmental organisations and more through its programmes.
"When it comes to the existential challenge of climate change, the need for collective action and collaboration is clear," she concluded. "We must work together, amplify each other's strengths, and build on each other's capabilities."
