A NEW initiative, called Voluntary Carbon Market, will be launched under Bursa Malaysia, as part of the government’s move to transition the country into a low-carbon economy.

       The initiative is expected to help the country meet its target to be a carbon-neutral country by 2050, Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said during the tabling of Budget 2022 yesterday.

       “This initiative will act as a voluntary platform for carbon credit trading between green asset owners with any entity toward a low-carbon practice transition,” he said.

       Tengku Zafrul noted Malaysia remains committed to achieve carbon neutrality by 2050.

       “This commitment requires the country to drive reform so that growth remains sustainable and competitive in global market,” he said.

       In addition, Tengku Zafrul said Malaysia is also committed to fulfilling its obligations as a signatory Treaty of Paris. On that note, he said the government would issue up to RM10bil ringgit-denominated sustainability sukuk next year to be channelled to eligible social or environmentally friendly projects.Last April, the government successfully issued the world’s first sovereign sustainability sukuk through an issuance of US$800mil (RM3.3bil) notes.

       The sukuk was oversubscribed by more than 5.6 times, reflecting investor confidence in Malaysia, Tengku Zafrul said.

       Meanwhile, financial industry players view the government’s initiatives to address climate-related challenges as a timely move as sustainability concerns gain momentum worldwide.

       They also see the initiatives as a necessary step to enhance the appeal of the Malaysian capital market.

       “The Voluntary Carbon Market initiative cannot come at a more critical time as the planet faces one of its biggest challenges - climate change,” Standard Chartered Bank (M) Bhd managing director and CEO Abrar A Anwar said. In a statement, he said everyone has a role to play in promoting sustainable and low-carbon practices.

       Similarly, OCBC Bank (M) Bhd CEO Datuk Ong Eng Bin said “the government’s initiatives on addressing the climate change issues and other sustainability-related measures are timely”.

       CIMB Group Holdings Bhd group CEO Datuk Abdul Rahman Ahmad said it is “optimal” that the government continues to emphasise policies that are aligned to the United Nations Sustainable Development Goals.

       “Through Budget 2022, the government has reiterated its goal to achieve carbon neutrality by 2050 and doubled down on its commitment towards driving the environmental, social and governance agenda,” he said.