APEC economies need to invest in new sustainability technologies: PM Lee

SAN FRANCISCO: Asia Pacific economies need to invest in new technologies in the area of sustainability, and Singapore wants to work with partners to scale up supply chains for low-carbon hydrogen, said Prime Minister Lee Hsien Loong on Thursday (Nov 16).

Speaking at a session at the Asia-Pacific Economic Cooperation (APEC) summit in San Francisco, Mr Lee said Singapore is very encouraged that the United States has made sustainability a key priority of its APEC chairmanship.

The theme for this year's 30th APEC summit, held in San Francisco, is Creating a Resilient and Sustainable Future for All.

"There is a great deal that the APEC economies can collectively do to accelerate progress on climate change," said Mr Lee, suggesting that these economies can invest in new, sustainable technologies.

"But new technologies have to be deployed at scale to become affordable and no economy can do this alone," he said.

"Singapore is developing a National Hydrogen Strategy to green our power sector. We look forward to working with like-minded partners to scale up supply chains for low-carbon hydrogen."

APEC economies, of which there are 21, can also work together to develop high-integrity carbon markets, Mr Lee said.

"We need clearer and more harmonised rules, requirements and standards around carbon credits - to build trust and confidence in the market and to encourage investments, create jobs and foster sustainable development, including by protecting biodiversity," he added.

The Prime Minister noted that Singapore recently published stringent eligibility criteria for international carbon credits to be accepted under the country's carbon tax regime.

These include requiring these carbon credits to comply with Article 6 of the Paris Agreement, which is a framework for countries to reduce greenhouse gas emissions by exchanging carbon credits.

Mr Lee then proposed that APEC members work together to develop new financial models to support the energy transition and decarbonisation.

Climate transition projects require huge capital investments, with the Asian Development Bank estimating that the region will need US$1.7 trillion per year in infrastructural investments for climate mitigation and adaptation over the next decade.

"We need to unlock private financing to complement public capital," said Mr Lee.

He said Singapore is in active discussions with industry partners, multilateral development banks and philanthropies to develop a "blended" finance partnership.

This will help to catalyse capital for green and transition projects in Asia and pilot innovative projects to scale the early retirement of the region’s coal-fired power plants.

"Singapore welcomes APEC’s set of Non-Binding Just Energy Transition Principles. It is important to have a credible, managed phase-out programme to mitigate potential impact to displaced workers and communities," said Mr Lee.

"So let us all work together towards a more sustainable future."

Besides official APEC business, global leaders are taking the opportunity to meet face-to-face during the APEC week, with US President Joe Biden and Chinese President Xi Jinping concluding high-stakes talks on Wednesday.

Leaders from the Indo-Pacific Economic Framework for Prosperity (IPEF) also met and signed a number of agreements ranging from clean energy, supply chain resilience and anti-corruption measures.

At the summit, it further launched a dialogue on critical minerals to foster closer collaboration on strengthening IPEF critical mineral supply chains.

IPEF, a group of 14 nations including Singapore, was established by Mr Biden's administration to bolster economic engagement with Asia after former president Donald Trump quit a regional trade pact in 2017. It was first launched in Tokyo in May last year.

However, the 13 IPEF members involved in trade talks, excluding India, did not come to a deal at this APEC. Members could not agree on improving labour and environmental standards or compliance, people briefed on the talks said.

In a statement on Thursday, IPEF leaders said that they have made progress on and continue to work towards a "mutually beneficial Trade Pillar outcome" benefitting all segments of society.

At an IPEF meeting on Thursday, Mr Lee said that he welcomes progress on the IPEF trade deal.

"Trade is the lifeblood of the global economy. And the trade pillar is an integral part of the IPEF agreement and of US’ economic and strategic engagement with the region," he said.

"But developing new and creative approaches in trade policy is not easy, and it takes time in order to carefully work through sensitive areas and to choose the best moment to commit the deal.

"Therefore, we look forward to further progress in the negotiations, as well as some tangible cooperation next year."

Singapore will continue to work closely with partners to implement the IPEF agreements and initiatives, he said.

"The IPEF should continue to be open, inclusive and flexible, including towards new members," said Mr Lee.

Mr Lee added that Singapore is happy to host the inaugural IPEF Clean Economy Investor Forum in the first half of 2024, which will help match capital to climate-critical projects to advance decarbonisation and transition to net-zero economies.

This complements the IPEF Climate Fund and IPEF Catalytic Capital Fund established by President Biden, to develop and finance climate-related projects in the region, Mr Lee said.

Mr Lee is on a six-day working trip to San Francisco to attend the APEC summit. He is also meeting business and political leaders, including Alphabet CEO Sundar Pichai on Thursday and California governor Gavin Newsom on Wednesday.

On Thursday, Mr Lee met President Dina Boluarte of Peru and discussed Peru’s priorities for its chairmanship of APEC in 2024.

They also discussed opportunities to advance bilateral ties and promote greater trade and investment flows between the two countries and regions, said a spokesperson from the Prime Minister's Office.