Resource Sector

Malaysia Warns New EU Rules Could Hurt Palm Oil Used In Food (15-22 Oct)

The European Parliament will proceed with phasing out palm oil-based biofuel by 2030 despite threats of retaliatory action by Indonesia and Malaysia, the world’s biggest producers of the ubiquitous vegetable oil. Malaysia, the world’s second largest producer and exporter of palm oil, warned on Tuesday against new European Union (EU) rules that could hurt demand for a commodity used in foods from snacks to chocolate spread, threatening a US$60-billion industry. Palm oil is used in everything from lipstick to biofuels, but its role as a cheaper cooking medium ensures that food accounts for nearly 70 per cent of global consumption of an edible oil whose cultivation is blamed for stripping tropical rainforest. The EU is looking at new limits on food contaminants in refined fats and oils, including palm oil, said Teresa Kok, Malaysia’s minister in charge of the agricultural mainstay.

Sources: The Straits Times, Mongabay

Indonesia: Land Burned In Forest Fires Surges In 2019 (21 Oct)

Indonesia has spent months to battle forest fires in Sumatra and Borneo that have caused thick haze which drifted over neighbouring Malaysia and Singapore. The amount of land in Indonesia consumed by fires through September this year has exceeded the amount burned during all of 2018, according to data given by a government official on Monday (Oct 21). Raffles Panjaitan, forest fire management acting director at the Forestry and Environment Ministry, told reporters that by the end of September 2019 a total of 857,756 hectares had been burned, higher than the 529,267ha in 2018. Fire fighting still continues to prevent escalation, the official noted.

Sources: Channel News Asia, The New Straits Times

Singapore Hosting Meeting Of UN Climate Body Shows Commitment To Climate Change (21-22 Oct)

Singapore is hosting a meeting of the United Nations climate science body for the first time this week, in a move experts say demonstrates the Republic’s commitment to tackling climate change. Professor Jim Skea of the Centre for Environmental Policy at Imperial College London said countries volunteering to host a meeting of the Intergovernmental Panel on Climate Change (IPCC) normally attached “quite a big importance to the issue of climate change”. Singapore is “pushing the boundaries” and developing new ways to transition to a “low-carbon future”, as it continues efforts to mitigate climate change, said Minister for the Environment and Water Resources Masagos Zulkifli on Monday (Oct 21).

Sources: Channel News Asia, The Straits Times

Mahathir Stands By Kashmir Comments Amid India Palm Oil Boycott (22 Oct)

Malaysian Prime Minister Mahathir Mohamad last month told the United Nations that India “invaded and occupied” Kashmir. Since then, Indian buyers of palm oil have been turning to Indonesia for supplies because of concerns that Prime Minister Narendra Modi will curb purchases of the vegetable oil from Malaysia. The trade spat between India, the world’s biggest palm oil buyer, and Malaysia seems to be escalating, with an influential processors’ group in Mumbai asking its members to refrain from buying the tropical oil from the second-largest producer. Mahathir said on Tuesday he would not retract his criticism of New Delhi’s actions in disputed Kashmir despite Indian traders calling for an unprecedented boycott of Malaysian palm oil. The impasse could exacerbate what Mahathir described as a trade war between the world’s second biggest producer and exporter of the commodity and its biggest buyer so far this year.

Sources: The Straits Times, South China Morning Post

Green Finance

EU, China, others, team up to coordinate ‘green’ investment financing (19 Oct)

The International Platform on Sustainable Finance (IPSF) was established to harmonise rules on what is sustainable, or “green” investment, across the world so that private capital can flow into it more freely. The initiative involves the European Union, China, India and several other countries, responsible for 44 percent of the world’s GDP and the same amount of carbon dioxide emissions. The US is not among the founding members but significant interest is coming from US states, the industry and the financial sector.

Sources: Reuters, Channel NewsAsia 

OCBC seeks more green loans to maintain lead in S-E Asia (21 Oct)

OCBC aims to expand its lending to environmentally-friendly projects after this year building the largest exposure to green loans among its peers in Southeast Asia. The bank started extending green loans after the Asia Pacific Loan Market Association (APLMA) laid out principles to increase transparency on the use of proceeds and on the environmental impact of projects. OCBC has ambitions to build a sustainable finance portfolio of $10 billion by 2022, and is nearly halfway toward that goal. The target will include lending classified as green loans as well as focused on environmental, social and governance initiatives, renewable energy, water and green transportation. This move is part of the growing green finance momentum in Singapore. As a regional financial hub, Singapore is well-positioned to tap on significant opportunities to channel more capital towards green and sustainable activities. More details can be found in the SIIA’s report, “Collaborative Initiative for Green Finance in Singapore: Singapore as a Green Finance Hub for ASEAN and Asia”.

Sources: The Straits Times, The Business Times, The Edge Markets

Global renewable power capacity to rise by 50% in five years: IEA (21 Oct)

According to the International Energy Agency (IEA), global renewable energy capacity is set to rise by 50 percent in five years’ time. Solar PV will account for about 60 percent of this growth and onshore wind 25 percent. Falling technology costs and more effective government policies have helped to drive the higher forecasts for renewable capacity deployment since last year’s report. The cost of generating electricity from distributed solar PV is already below retail electricity prices in most countries. Policy and tariff reforms are needed to ensure solar PV growth is sustainable and avoid disruption to electricity markets and higher energy costs.

Sources: Reuters, The Straits Times, CNBC, The Guardian