The capital required to fuel Singapore's sustainability drive will be partly raised by the Government issuing green bonds for certain public infrastructure projects, Deputy Prime Minister Heng Swee Keat said yesterday.
Around $19 billion of public sector projects have already been earmarked for the process.
These include Tuas Nexus, Singapore's first integrated water and waste treatment facility, which will be ready from 2025.
Tuas Nexus consists of two mega facilities - a water reclamation plant and an integrated waste management complex - which will be managed separately by national water agency PUB and the National Environment Agency.
Having both facilities on one site saves up to 2.6ha - the size of four football fields - compared with building two standalone plants.
Treating used water and food waste in the same plant means more biogas can be produced and used for electricity generation for the complex, which will be energy self-sufficient once other renewable power sources, including solar panels, are utilised.
Mr Heng said issuing green bonds on public infrastructure projects will bolster the Singapore dollar market for such capital-raising instruments and, in turn, boost the nation's efforts to be a regional centre for sustainable finance.
Mr Clifford Lee, DBS Bank's global head of fixed income, said government moves to issue such bonds will help meet the growing demand from investors locally and abroad.
"This paves the way for a steady supply of green bonds to be issued out of Singapore, generating more secondary market activity, deepening and broadening our capital markets," he added. "Accompanying financial structural innovation can also grow, to help cement Singapore's position as the region's leading green financing hub."
Mr Heng, who is also Finance Minister, said yesterday that Singapore, as an international financial centre, can catalyse the flow of capital towards sustainable development not just here, but also in the rest of Asia.
The Monetary Authority of Singapore has been driving Singapore's Green Finance Action Plan to develop green finance solutions and markets for a sustainable economy, he said.
"The issuance of green bonds by the Government will build on these efforts by deepening market liquidity for green bonds, attracting green issuers, capital and investors, and anchoring Singapore as a green finance hub," he added.
Mr Alvin Seo, global lead for environment, social and governance at solar company Maxeon Solar Technologies, said Singapore's plan to develop into a hub for sustainable finance and carbon services - which include trading carbon credits - could help in the green recovery from Covid-19 and lead to economic growth.
"If there is buy-in from the top, we can move very fast, and we have proof that we can move fast. For example, we became one of the most recognised tech hubs in the world," he noted.
Audrey Tan and Ivan Kwee
