Singapore and Thailand Launch Cross-Border Carbon Credit Scheme Under Paris Agreement
Singapore and Thailand have launched a new carbon credit scheme under their bilateral agreement. The programme allows Singapore-based companies to fund emissions-reduction projects in Thailand and use the credits to lower their domestic carbon tax. Applications for eligible projects are now open to developers in both countries. The initiative follows a framework aligned with Article 6 of the Paris Agreement. It enables the cross-border transfer of high-integrity carbon credits, with corresponding adjustments to prevent double counting. Singapore will cancel 2% of the issued credits at first issuance as part of the process.
Projects must meet methodologies approved by recognised standards such as Gold Standard, Verra, the Global Carbon Council (GCC), or REDD+ programmes. Eligible schemes are expected to support sustainable development in Thailand, including job creation and reduced pollution. Applications will undergo a three-stage review: a concept note, a full project design document, and final verification of corresponding adjustments. Once approved, Singaporean companies subject to carbon tax can use the credits to offset up to 5% of their taxable emissions. Singapore has similar agreements with ten other countries, reflecting its limited domestic options for cutting emissions. Officials describe the city-state as an 'alternative-energy disadvantaged country' with few opportunities for large-scale mitigation projects.
The scheme strengthens Singapore's push toward net-zero emissions by 2050 through international carbon market cooperation. Authorised projects will also bring environmental and economic benefits to Thailand. The first credits are expected once the review process is complete.
