Singapore-Laos deal sets binding framework for carbon-credit transfer

The agreement covers credit generation and transfers under Article 6.

Singapore and the Lao People’s Democratic Republic (Lao PDR) have signed an implementation agreement establishing a legally binding framework for carbon-credit collaboration under Article 6 of the Paris Agreement.

The agreement covers the generation and transfer of carbon credits from carbon mitigation projects aligned with Article 6 rules, according to Singapore’s Ministry of Trade and Industry.

Project developers will be able to develop carbon-credit projects under the framework. Singapore said information on the process for authorising projects and eligible carbon-crediting methodologies will be published in due course.

The agreement is Singapore’s 12th implementation agreement on carbon-credit collaboration and its fourth with an ASEAN member state.

Singapore’s Minister for Sustainability and the Environment and Minister-in-charge of Trade Relations Grace Fu said the agreement “is an important milestone in our bilateral partnership and unlocks new opportunities in carbon markets for businesses and local communities”.

Lao PDR’s Minister of Agriculture and Environment Dr Pinkham Douangsavanh said the agreement provides “a transparent, high-integrity framework” for developing carbon-credit projects that create jobs, protect the environment, and direct climate finance towards adaptation in Lao PDR.

The collaboration will direct financing towards additional emissions-reduction opportunities in Lao PDR.

Projects authorised under the agreement are expected to support sustainable development, create jobs, and reduce environmental pollution.