Bursa Malaysia launches national voluntary carbon market handbook 

Inve$t | Market Sentiments | 06 October 2023

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Bursa Malaysia Berhad has launched the national voluntary carbon market (VCM) handbook to guide local professionals and stakeholders in generating carbon credits that adhere to international standards recognised by the Bursa Carbon Exchange. 

According to Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift, as Malaysia shifts towards becoming a lower carbon economy, the VCM handbook is a relevant guide designed to assist entities keen on participating in carbon market project development and Malaysia’s voluntary carbon market. The handbook defines the roles and functions of key entities in Malaysia’s carbon market operations, serving as a reference point for market players. 

The increasing prominence on carbon offsets and carbon markets globally, has made it imperative that Malaysia acts on the nation’s untapped potential by developing its VCM ecosystem and implementing high-quality carbon projects. This VCM handbook is a critical step in ensuring Malaysia’s VCM can truly support the country’s net zero journey. He said this at the inaugural Malaysia Carbon Market Forum 2023 on Thursday October 5th, in conjunction with the International Greentech & Eco Products Exhibition and Conference Malaysia (IGEM 2023). 

The VCM handbook is a collaborative effort between Bursa Malaysia and the Malaysian Green Technology and Climate Change Corporation (MGTC), which was initiated through a memorandum of collaboration signed on Feb 20, 2023. The VCM handbook was developed in consultation with the Ministry of Natural Resources, Environment and Climate Change (NRECC) and various ecosystem participants. 

He also added that one of Malaysia’s nature-based projects, the Kuamut Rainforest Conservation Project in Sabah, is nearing its first issuance and that soon enough, our carbon ‘supermarket shelves’ will be stocked with Malaysian products.  

According to NRECC minister Nik Nazmi Nik Ahmad, Bursa Malaysia is getting ready to auction carbon credits from the Kuamut Rainforest Conservation Project. The auction date will be announced once Verra, the world’s leading standards setter for climate action and sustainable development, has issued Kuamut’s carbon credits. The project is commendable, as it is being verified for a triple gold labelling under Verra’s co-benefit standard of climate, community and biodiversity. 

He also said that the government needs nature-based solutions (NbS), which can provide up to 30% of the mitigation required by 2030 to keep the 1.5°C target in reach. The VCM would help mobilise public sector finance towards NbS, particularly in the Global South where it is most urgently needed. Many state governments have reached out to his ministry for alignment of carbon policies for forest carbon assets, and the NRECC is doing its best to ensure that these discussions take place. 

He reiterated that Malaysia’s National Carbon Policy is expected to be ready for implementation this year which will provide, among other things, guidance on carbon trading at the state level. 

ASEAN set to become world’s factory and consumer base: Tengku Zafrul 

According to the Minister Of Investment, Trade And Industry (MITI) Tengku Datuk Seri Zafrul Aziz, ASEAN is the new China and the region is set to become not just the world’s factory but also a consumer base. The government is tapping into opportunities arising from the shifting global supply chains. 

The 10 nations that make up ASEAN are already home to more than 678 million people, with a combined GDP of about US$3.7 trillion (RM17.4 trillion) in 2022. As a bloc, ASEAN is the fifth-largest economy in the world. It also had a middle class of roughly 350 million in 2022, representing US$300 billion of disposable income. He was speaking at the signing of a memorandum of understanding (MoU) on the Second Chance Financing Scheme for SMEs between MIDF and Agensi Kaunseling dan Pengurusan Kredit (AKPK). 

Malaysia’s SMEs’ survival in local supply chains could help them to capitalise on not only ASEAN’s growing middle class, but also shifting supply chains to and FDI flowing into the region. It is important to support SMEs, in the context of global supply chains that are shifting to Southeast Asia. The regional economic integration is also a goal that is espoused by the Madani Economy framework. 

The government has announced RM60 million in second chance financing opportunities for SMEs in the 12th Malaysia Plan. MIDF and AKPK will provide SMEs that are facing challenges and financial difficulties with financial assistance, advisory services and business guidance. 

The MIDF Second Chance Financing Scheme offers financing of up to RM5 million for assets or working capital financing at a rate of 3% per annum. The aim is to enable SMEs to overcome challenges, fuel growth and contribute to the overall economic development of the country. 

Sudden shifts in market conditions, unforeseen disruptions, or internal struggles can push promising companies to the brink of failure and can have far-reaching consequences for a production’s entire supply chain, encompassing suppliers, customers, employees and possibly the surrounding communities. Therefore, providing these companies with a financial lifeline which supports their business recovery is crucial in ensuring that supply chains remain intact which in turn, is crucial to the nation’s socio-economic development. To that end, the MIDF-AKPK collaboration is an important, holistic ‘recovery ecosystem’ in terms of supporting troubled companies, particularly the SMEs. 

M’sia set to become regional renewable energy industry leader with launch of Hydrogen Economy and Technology Roadmap – Fadillah 

According to Deputy Prime Minister Datuk Seri Fadillah Yusof, with the launch of Malaysia’s Hydrogen Economy and Technology Roadmap (HETR), the country will be pushed to the forefront of the energy transition, and to become a regional leader in the renewable energy (RE) industry.The HETR was launched during the opening ceremony of the 14th International Greentech and Eco-Products Exhibition and Conference Malaysia (IGEM) 2023. 

Fadillah, in delivering the opening keynote address on behalf of Prime Minister Datuk Seri Anwar Ibrahim, said the successful implementation of the HETR will enable Malaysia to tap into the global green hydrogen market, estimated to be worth at least US$189.19 billion (RM824 billion) by 2050. The HETR implementation alone is anticipated to have prospects of generating up to RM12.1 billion in revenue, with an estimated contribution of between RM49 billion and RM61 billion to gross domestic product by 2030, generating over 45,000 job opportunities over the same period. 

With the implementation of initiatives under the recently unveiled National Energy Transition Roadmap (NETR) and now, the HETR, Malaysia is set to be at the forefront of becoming a regional leader in the energy transition and renewable energy industry. 

The IGEM 2023 is themed “Race Towards Net Zero: Leadership for Climate Action” and could play a decisive leadership role in accelerating and delivering the region’s net zero and energy transition agenda. Organised by the Ministry of Natural Resources, Environment and Climate Change, and co-organised by the Malaysian Green Technology and Climate Change Corporation (MGTC), IGEM is Southeast Asia’s leading trade event for green technologies and eco-solutions. 

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