Singapore: Minister for Trade and Industry Gan Kim Yong and Bhutan’s Minister for Energy and Natural Resources Loknath Sharma reaffirmed their commitment to global climate action today and signed a Memorandum of Understanding (MOU) to collaborate on carbon credits.

"The MOU will strengthen cooperation between Singapore and Bhutan on carbon credits aligned with Article 6 of the Paris Agreement, which allows countries to cooperate to achieve emissions targets set out in their Nationally Determined Contribution (NDC) while promoting sustainable development and high environmental integrity," read a statement issued by the Ministry of Trade and Industry in Singapore.

Under the MOU, Singapore and Bhutan agreed to work towards signing a legally binding bilateral agreement that sets out a framework for the international transfer of correspondingly adjusted carbon credits by end-2023.

Both countries will also identify mutually beneficial Article 6-compliant carbon credit projects that will support both countries in achieving their NDCs.

Minister Gan said, “Effective partnership between countries is important in addressing the global climate challenge.

This is the first MOU that Singapore is signing with a carbon-negative country.

"Through this MOU, Singapore and Bhutan intend to collaborate on carbon credits aligned to Article 6 of the Paris Agreement, which will enable us to accelerate decarbonisation, and generate mutual benefits including growing each other’s green economy," read the statement.