APEC businesses propose new climate bonds and carbon credit network

In Washington DC, Voice of America reports Asia-Pacific Business Advisory Council business executives have proposed the issuance of climate bonds indexed to a basket of currencies and recommended launching a pilot program for a voluntary carbon market (VCM) within the Asia-Pacific region.

Highlighting the vulnerability of Asia to climate-related disasters and economic reliance on fossil fuels, ABAC urged governments to issue 10-year bonds with payments indexed to multiple currencies, allowing developing nations to secure hard currency for investments in renewable energy infrastructure.

The carbon credit pilot program seeks to facilitate cross-border carbon credit transactions, addressing regulatory and standardization challenges. “What we’re trying to establish is an interoperable, or mutually tradeable, voluntary carbon credit network within the Asia-Pacific region,” stated Hiroshi Nakaso, head of ABAC’s finance and investment task force.

ABAC’s recommendations, developed during a meeting in Tokyo from August 1-4, reflect the growing recognition of the need for collaboration between the public and private sectors to finance energy transitions. The group plans to present these proposals at the APEC leaders’ summit in Lima this November.