Taiwan's carbon, stock exchanges sign MOU with Eswatini

Taipei, March 5 (CNA) The Taiwan Stock Exchange (TWSE) and the Taiwan Carbon Solution Exchange (TCX) each signed memorandums of understanding (MOU) with the Eswatini Stock Exchange (ESE) in Taipei on Monday.

The signing of the MOUs with Eswatini, Taiwan's only remaining formal diplomatic ally in Africa, was a response to Taiwan's foreign policy efforts and a significant milestone for cooperation between the two sides' capital markets, the TWSE said in a statement.

TCX CEO Joshua Tien (田建中) said at the signing ceremony that the carbon-related MOU will link the two carbon credit markets, with carbon credits based on Eswatini's abundant natural resources likely to be traded on the TCX in the future.

As for the stock exchange MOU, TWSE President Chien Lih-Chung Chien (簡立忠) said it was the first partnership between Taiwan and Eswatini related to capital markets and had symbolic significance.

"The collaboration will enable Taiwan to share its experience with the world and strengthen Taiwan's international influence," Chien said.

Ray Lin (林瑞岳), chairman of Taiwan textile group Tex-Ray Industrial Co., which has invested in Eswatini for more than 20 years, has also served as honorary consul-general of Eswatini in Taiwan and was the key middleman for the MOU signings.

He said he has high expectations for bilateral cooperation on carbon credits because of Eswatini's natural resources and the carbon sinks they represent.

According to TCX's Tien, the partnership between the two countries will start with exchanging carbon credit-related information and sharing carbon credit techniques and knowledge, and then expand to talent training and other substantive exchanges in the future.

Eswatini's carbon credits, which most likely will be "green and yellow carbon [credits]," will be able to be traded on the TCX after being certified by international institutions and reviewed by Taiwan's Ministry of Environment, Tien said.

Green carbon credits are from natural carbon sinks found on land, mainly forests, while yellow carbon is soil carbon that can be stored in soils by changing to organic farming practices, according to Tien.

Phil Mnisi, the governor of the Central Bank of Eswatini who witnessed the MOU signings, said Eswatini's climate issues, including floods, droughts and heat waves, have gotten worse in recent years, indicating that the climate challenge had to be taken on immediately.

One way to address the challenge is with carbon credits, he said, noting that Article 6 of the Paris Agreement allows countries to transfer carbon credits earned from the reduction of greenhouse gas emissions in one country to another country to meet the latter's climate target.

Liou Je-liang (劉哲良), TCX board member and a research fellow at the Center for Green Energy of the Chung-Hua Institution for Economic Research (CIER) in Taipei, said Article 6 provides a way for Taiwan and Eswatini to work together on carbon credits in the future.

Taiwan is not a signatory to the Paris Agreement, adopted by members of the United Nations at the U.N. Climate Change Conference (COP21) in Paris in 2015, but it has kept tabs on the agreement's requirements and aligned its own policies accordingly.

Compared to Taiwan's foreign aid to its allies that mainly involves one-way financial assistance, the MOU on carbon promises mutual benefits, with Taiwan helping with carbon credit techniques and certification and Eswatini listing its carbon credits on the TCX, Liou said.

(By Luo Yuan-chun, Tseng Jen-kai, and Alison Hsiao) enditem/ls