Put a price on carbon emissions to reach net-zero goals: PM Wong to Apec leaders

LIMA - Countries should progressively put a price on carbon despite political sensitivities, said Prime Minister Lawrence Wong at

the Asia-Pacific Economic Cooperation (Apec) summit.

“It’s not easy to do, it’s politically sensitive, but there is no pathway to net zero without pricing carbon properly,” he told leaders of Apec’s 21 economies.

“This will send a clear market signal to producers and consumers away from carbon-intensive activities.”

Speaking at the Apec Economic Leaders’ Retreat on Nov 16, PM Wong said putting a price on carbon makes cooperation on carbon markets more possible.

Carbon trading allows countries to reduce emissions even if they are disadvantaged in terms of alternative energy, and spurs climate action in most, he noted.

“So it’s really a manifestation of win-win trade,” PM Wong added.

He said Singapore has concluded a network of memorandums of understanding and agreements on carbon market collaboration, and hopes to do more with Apec economies.

In addition to carbon markets, PM Wong also spoke of unlocking and harnessing more sources of low-carbon power.

This is critical because many new digital technologies are “energy guzzlers”, he said.

Renewable energy sources such as wind and solar power need to be scaled up, while more low-carbon fuels are needed for baseload power generation, PM Wong said.

He raised the possibility of hydrogen being used for this purpose, but said it still costs too much to be used on a large scale.

“We must continue to intensify R&D (research and development) and investments in hydrogen as well as other energy sources, including nuclear power, in order to improve their viability and expand options for the future,” PM Wong said.

He added that infrastructure is also needed to allow countries rich in renewable energy resources to export energy to those that are not.

This is why Singapore is working with its South-east Asian partners to develop the Asean Power Grid, which will accelerate the renewable energy transition while improving collective energy security, he noted. 

As a financial centre, Singapore will do its part to catalyse and mobilise more green transition financing for such projects, he said.

PM Wong also spoke on challenges posed by the green transition, pointing out that current trade agreements do not always lend themselves to cooperation in new areas.

This is the case for the digital economy, he said. In response, Chile, New Zealand and Singapore put together the Digital Economy Partnership Agreement to set standards around data sharing and trade.

The three countries are now forming a joint working group to catalyse thinking on rules and standards relating to low-carbon solutions, as well as facilitate cross-border trade and investment in the green economy, PM Wong said. 

Eventually, the group can form the basis for a new partnership agreement for the green economy, he added.

It is in such concrete ways that Apec can stay relevant and vibrant in a changing world, he said.

On Nov 16, PM Wong also met New Zealand Prime Minister Christopher Luxon and Peru President Dina Boluarte on the sidelines of the Apec summit.

In a post on social media site X, PM Wong said New Zealand and Singapore are like-minded and trusted friends.

He added that he looks forward to the elevation of the Singapore-New Zealand Enhanced Partnership in 2025.

On his meeting with Ms Boluarte, PM Wong said both leaders discussed new areas of cooperation. 

Singapore and Peru are geographically far apart but have “warm and growing ties”, he added.