KUALA LUMPUR: Malaysia is well poised in taking the Asean lead in creating a more sustainable and greener future.
This, according to the chief executive officer of Climate Bonds Initiative (CBI) Sean Kidney, is primarily because of Malaysia's position as a global leader in Islamic Finance (IF) and the willingness of its policy makers in making the change.
“Malaysia as it is, is one of the signatories to the 2015 Paris Agreement which aimed at reducing carbon emissions by 2030. And by all accounts, Malaysia is making a good head start towards this objective,” he told NST Business at the 2018 World Capital Markets Symposium (WCMS).
“The country’s position as the global leader of IF is also instrumental in its pushed towards a greener future as a lot of IF is very much aligned with sustainable investment.”
Kidney said there had already been three Green Sukuk issuances under the Securities Commission (SC) Sustainable Investment Sukuk framework, since the launch of the framework in 2014.
“This in particular is great because it shows that corporates and stakeholders are willing to move beyond 'legacy’ assets and industries such as oil and gas (O&G),” he said.
“These legacy industries are a challenge to manoeuvre around in. Despite Malaysia being one of the better countries at diversifying its economy, it is still very much reliant and known as an O&G economy. In order to move on into a greener and cleaner future, it will need to let go of this legacy industry.”
Kidney added that he will not be surprised if one day Malaysia, given also its position as one of the stronger economies in Asean, will also take the lead in bringing the rest of Asean into a greener future.
“Right now it is down to Malaysia and Singapore, but I do believe that Malaysia can lead the way as its policy makers are more open to embracing a greener, sustainable and holistic approach to capitalism. This is something that I have yet seen in its neighbouring country,” he said.
CBI is an investor-focused non-profit organisation based in London, England working to mobilise debt capital markets to fund a rapid, global transition to a low-carbon and climate resilient economy.