KUALA LUMPUR: Bursa Malaysia Bhd's subsidiary, Bursa Carbon Exchange (BCX) carried out its first Malaysian carbon credit auction today with carbon credits from the Kuamut Rainforest Conservation Project in Sabah.
In a statement today, it said the milestone represents a crucial step in admitting the first Malaysian natured-based carbon project onto the BCX.
The auction also establishes a benchmark price for voluntary carbon credits for Malaysian nature-based carbon projects. The auction of the domestic forest protection and regeneration project was cleared at RM50 per contract.
Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said in order to accelerate the development of domestic carbon projects Malaysia must adopt some form of compliance carbon pricing instrument to ensure sustainable demand and pricing for domestic carbon credits.
Bursa Malaysia cautioned however that any carbon pricing instrument needs be implemented at the right level(s) to balance decarbonisation actions with the viability of businesses in developing countries like Malaysia, so that the principle of just transition is upheld.
The Kuamut project has earned international recognition and is rated best in class, as one of the highest-rated improved forest management (IFM) projects in the world by the carbon rating agency BeZero Carbon.
A key significance of this project is that it delivers
tangible climate, community and biodiversity co-benefits, earning itself a Gold Level for Climate status under the Climate, Community and Biodiversity (CCB) Standards. The Kuamut Project also contributes to several UN Sustainable Development Goals.
For Malaysia, the Kuamut Project is of national importance as it demonstrates that Malaysian forests can successfully yield high integrity carbon credits.
As a lighthouse project for local forestry-based carbon credits, it paves the way for other states to look into preserving their forests and natural resources, while contributing to the nation's commitment to maintain at least 50 per cent of the country's land that is under forest and tree cover, a pledge made during the Earth Summit in 1992.