Asia Climate Summit Bangkok (8-10 July): ASEAN’s Race to a US$3 Trn Carbon Market

Early evening in Bangkok, delegates meet in a small, rented workspace near Benjakitti Park, reviewing tomorrow’s Asia Climate Summit agenda over iced coffee. One carries a draft ITMO-swap memorandum from Manila, another highlights key sessions on a fresh printout. Their focus is the same headline figure: up to US$3 trillion that ASEAN could earn from carbon trading if Article 6 is fully implemented. Tomorrow they will gather at the Queen Sirikit National Convention Center to start turning that possibility into policy.

Why Bangkok, why now

Thailand is hosting because it wants to prove, ahead of its own Emissions Trading Scheme target date of 2026, that the country can move from voluntary offsetting to a fully-fledged compliance market. Parliament passed the Climate Change Act last December, bolting carbon-price language into the investment code and pledging net-zero by twenty-sixty. The law has created a domestic rush for high-quality offsets from forestry corridors in Chiang Mai and solar farms on the Eastern Economic Corridor. Yet Bangkok is also convenient diplomatic ground. Less than eight months have passed since COP twenty-nine in Baku finally agreed on the operational rules for Articles 6.2 and 6.4, closing nearly a decade of negotiation. Many Asian governments still need plain-language workshops to translate that legal text into bankable contracts. Hosting a three-day summit in the heart of Southeast Asia gives officials, lawyers and financiers a safe space to test run transactions before COP thirty in Brazil.

For the private sector the timing is also practical. The European Carbon Border Adjustment Mechanism enters its first tariff-collecting phase in twenty-twenty six, nudging exporters in Vietnam, Indonesia and Malaysia to price carbon or lose market share. Airlines must start purchasing compliance-grade credits under the CORSIA regime next January. Together these forces have created a sense that the window for cheap offsets is closing fast. Deals inked in Bangkok could lock in single-digit prices before a regional price floor emerges.

A walk through the programme

Visitors will find the summit organised around three long days that blend technical deep dives with headline plenaries. The table below maps the flow.

Day	Highlight sessions	Issues we expect to dominate the hallway chat
8 July	Integrity of Carbon Transactions workshop; Nature Climate Solutions round-table	Legal definition of a carbon credit as a transferable asset; audit trails for forest projects
9 July	Plenary on Compliance Markets; CORSIA focus session	Whether aviation demand can anchor prices for ASEAN credits; progress on registry linkages
10 July	Plenary on future of Voluntary Markets; Article 6 implementation clinic	Host-country authorization fees and the mechanics of corresponding adjustments

The first morning starts almost academically. Lawyers from Bangkok’s largest firms will set out the fine print of ownership and liability. After lunch, the tone changes as project developers showcase mangrove plantings from the Mekong Delta and biochar kilns from Kalimantan that are hungry for pre-finance. The second day widens the lens. Civil-aviation regulators present passenger growth projections that imply a need for as many as one hundred million tonnes of CORSIA eligible credits a year by twenty-thirty. The final day attempts to pull loose ends together. Delegates will debate whether host countries should collect a two or a five per cent share of proceeds when an international credit is issued. Numbers matter because they ripple into project returns and, ultimately, into the price at which credits will clear on exchanges from Singapore to Tokyo.

Counting to three trillion

Southeast Asia contains one third of the world’s potential nature-based sequestration according to a joint study by Abatable, the ASEAN Alliance for Carbon Markets and Equatorise. If fully tapped, analysts calculate cumulative revenue of nine hundred billion to three trillion dollars between now and twenty-fifty. The range depends chiefly on how fast average prices climb from today’s $6 USD a tonne toward the $40-$65-dollar band considered necessary for credible decarbonisation.

Forestry credits would supply the cheapest early volumes. Think REDD+ corridors in Borneo or the Cardamom Mountains. Blue-carbon restoration along Thailand’s gulf coast and the Philippines’ mangrove belts adds diversity and higher durability scores, fetching premiums that already flirt with ten dollars a tonne. Industrial abatements, from clinker substitution in Indonesian cement to methane capture at Vietnamese landfills, dominate the upper end of the cost curve but also create the largest volume of tradeable units once capital has been deployed.

Scaling to that number requires money up front. Boston Consulting Group estimates six trillion dollars in green capital expenditure across power; land use and heavy industry will be necessary to unlock the credit flow. Much of that will need blended finance structures. Expect to hear multilateral development banks pitch de-risking facilities in Bangkok, positioning themselves as bridge lenders until Article 6.4 demand matures.

The human drama behind Article 6

Article 6 sounds like bureaucratic jargon but it is really a story about trust. In Paris ten years ago countries agreed that they could help each other meet climate targets, yet they could not settle on how to count those cross-border reductions without double claiming them. Baku finally produced a handbook thick enough to satisfy accountants and thin enough that politicians were willing to sign. Still, the ink is fresh. Bangkok is the first regional test of whether the rules can survive contact with spreadsheets, lenders and regulators.

Under Article 6.2 two governments can exchange Internationally Transferred Mitigation Outcomes, or ITMOs, much like foreign-exchange reserves. Under Article 6.4 a UN-supervised registry will issue credits to private projects, provided host countries approve and apply a corresponding adjustment to their own national ledger. The adjustment sounds benign. In practice it can affect state revenue, because moving an emissions reduction offshore subtracts from the host’s own tally toward its Nationally Determined Contribution. Thailand therefore wants a fee on every tonne exported. Indonesia is publicly neutral but insiders hint at a dual-taxonomy model that reserves prime rainforest credits for domestic compliance buyers. Such details matter to developers who have structured cash flows around export rights. Expect tense side-room negotiations each evening as legal advisers recalculate waterfall models.

A pair of think tanks will host a breakfast on accountability the second morning. Civil society groups worry that high-value credits could encourage land grabbing unless indigenous communities receive a direct slice of revenue. The summit secretariat has scheduled a listening session where tribal leaders from Sabah and Mindanao will share cases of successful benefit-sharing. The organisers hope the conversation pre-empts headlines of exploitation that could taint the entire market.

A compliance market on the horizon

While voluntary offsets have dominated until now, a clear pivot toward mandatory buying is visible across the region. Singapore’s carbon tax is stepping from twenty-five to eighty Singapore dollars a tonne by twenty-thirty, and companies can offset a portion with international credits only if those units carry Article 6 stamps. Indonesia began a pilot cap-and-trade system in February and plans to expand beyond the power sector next year. Thailand’s draft ETS bill, now in committee, points to a twenty-twenty six launch with initial coverage of large stationary emitters. These policies matter because they channel predictable volumes of demand into the market and compress the price gap between compliance and voluntary credits.

ASEAN Carbon-Pricing Readiness at a Glance

Country	Compliance instrument (status)	Current / scheduled price*	2024 voluntary retirements	Readiness score‡
Singapore	Carbon-tax law in force since 2019. No ETS; allows eligible Article 6 credits for up to 5 % of taxable emissions.	S$25 tCO₂e in 2024 → S$45 in 2026-27 → S$50-80 by 2030	High (≈ 10 Mt retired via CIX & OTC desks)	★★★★★
Indonesia	Pilot power-sector ETS live 2024; staged expansion through 2026. Carbon-tax law (IDR 30 000 ≈ US$ 2) applies to coal plants above emission cap.	ETS: intensity caps; Tax: ~US$2 t (coal)	Medium (≈ 5 Mt, mainly REDD+ units)	★★★★☆
Thailand	Climate Change Act in cabinet review; national ETS slated for 2026 launch. Draft carbon-tax option (THB 200 ≈ US$ 5) under debate.	Planned: THB 200 t or ETS allowance price (tbd)	Low-medium (< 1 Mt, T-VER programme)	★★★☆☆
Vietnam	ETS pilot June 2025-Dec 2028 (steel, cement, power); full market from 2029.	Pilot allowances free; cash price likely US$5-10 t	Low (~ 0.5 Mt, JCM & VCU retirements)	★★★☆☆
Malaysia	Budget 2025 sets 2026 carbon tax (steel, iron, power); Bursa BCX voluntary exchange live since 2023.	Proposed MYR 40-60 t (≈ US$ 9-13)	Low (~ 0.4 Mt)	★★☆☆☆
Brunei Darussalam	National Climate Policy Strategy 6 targets carbon-pricing mechanism by 2025.	Price tbd (study phase)	Negligible	★★☆☆☆
Philippines	No explicit price; DOF scoping carbon-tax bill for 2026. Voluntary market guidance in Congress (HB 8762).	Draft PHP 1000 t (≈ US$ 18)	Negligible (< 0.2 Mt)	★★☆☆☆
Cambodia	No compliance scheme; exploring Article 6 deals and domestic offset registry with UNDP.	—	Very low	★☆☆☆☆
Lao PDR	No compliance price; feasibility study for JCM-linked credit platform.	—	Very low	★☆☆☆☆
Myanmar	No policy (political instability).	—	No data	☆☆☆☆☆

* Prices are headline tax rates or indicative ETS allowance guide prices, reported in national budgets, draft bills or government consultations as of July 2025.† Voluntary-retirement volumes are rounded, taken from Ecosystem Marketplace “State of the Voluntary Carbon Market 2025” database and registry press releases.‡ Five-star heuristic: combines (1) legal status of a carbon-pricing instrument and (2) maturity of voluntary-credit activity.

Narratives often treat compliance and voluntary as rival realms yet the two are converging. When a corporate buyer in Jakarta retires a high integrity credit to meet its Science Based Target initiative pledge, that action pushes up reference prices used by regulators when setting tax levels. Conversely, once the Singapore registry starts vetting credits for its domestic market, project developers everywhere in the region will emulate its disclosure standards to remain saleable. In that sense Article 6 is less a two-track system than a funnel drawing voluntary enthusiasm into a rules-based architecture.

From policy talk to property strategy — the home stretch of our Bangkok story

The lights inside the Queen Sirikit centre burn late after the second day of negotiation. Delegates huddle around tablet screens where draft clauses flicker in tracked-change red, yet the energy in the corridor feels almost bullish. They can see a pathway at last: if Article 6 credits move across borders with clear ownership rules, money will flow, and the region’s skyline may never look the same. In the real-estate world the question is no longer whether carbon markets matter, but how soon project models must absorb a genuine price on residual emissions.

Real-estate portfolio playbook

Banks and tenants will not wait for perfect regulation. In private meetings upstairs, asset managers trade notes on four moves that can hard-wire resilience into bricks and mortar right now.

First comes design. New towers that specify mass timber cores or low clinker concrete can deliver sixty-per-cent embodied-carbon cuts before the first tenant signs a lease. Second is on-site generation. Rooftop solar and battery hybrids can shave Scope Two exposure and soften the blow if credit prices leap from today’s single digits toward the forty-dollar band many analysts see as inevitable by the end of this decade.

Third is procurement. Several landlords have started to forward-purchase high integrity forestry credits at about twelve dollars a tonne, locking supply for hand-over dates in 2027 and beyond. CapitaLand’s announcement in May that it had secured options for one million tonnes of REDD plus units sent a clear signal that defensive hedging has entered the mainstream.

The final lever is twinning. Developers structure a single package in which they bankroll a solar mini-grid or a mangrove restoration in exchange for a guaranteed stream of Article 6.4 credits over ten years. Lawyers describe the arrangement as a build-transfer-offset model. Accountants prefer the simpler label, negative capex. Whatever the name, it can tilt an internal rate of return by forty basis points in markets where exit valuations reward net zero ready status.

Lever	Indicative cost / pay-back window
1 Build to Net-Zero (mass-timber or low-carbon concrete in new projects)	Cap-ex premium 0 – 10 % yet delivers 30 – 50 % embodied-carbon cuts; leasing studies show premium rent recovers the extra spends in ≈ 8 – 10 yrs.
2 On-site RE + Battery Storage (rooftop solar under NEM / wheeled PPAs)	Typical Malaysian commercial rooftop PV hits ROI in 6.5 – 8 yrs at 2025 tariffs; batteries add 3–4 yrs.
3 Forward purchase of high-integrity credits (locking supply before prices lift)	High-quality REDD+ now US$ 15 – 35 / t forward (Abatable floor-price analysis).
4 Twinning “build–transfer–offset” packages (fund on-site abatement in exchange for Article 6 credits)	Adds ≈ 40 – 60 bps IRR uplift versus plain vanilla green loan when host-country fee < 5 %.

Investor watch-list — the deals that could set regional benchmarks

Bangkok’s hall chatter repeatedly circles back to three upcoming transactions. The first involves a seventy-megawatt geothermal expansion in West Java that will ship half a million ITMOs each year to a Singapore logistics real-estate trust once both governments sign host-country authorisations. The second is a pilot in the Ba Ria steel corridor of Viet Nam, where slag hydration technology aims to trim process emissions by forty per cent, with ArcelorMittal planning to route the resulting credits into the European Union’s Carbon Border Adjustment compliance pool.

The third project is blue carbon and perhaps the most emblematic. Ayala Land has financed eight thousand hectares of mangrove restoration in the Philippines’ Calamian Islands. The field teams are already on site, measuring canopy density that will feed into the baseline. If the Article 6 supervisory body approves the methodology this autumn, those hectares could earn more than one point eight million credits over two decades, priced at a projected premium because of higher permanence scores.

Project	Concession / JV signed	Construction window	First credit issuance*	First cross-border transfer*
Indonesia–Singapore 70 MW geothermal ITMO	13 Jun 2025 – Green-energy & carbon-co-op MoUs inked in Jakarta	Q2 2027 → Q4 2029 drilling & plant build(per Sumitomo loan roadmap for Muara Laboh expansion)	2029 — geothermal plant targets CoD in late-2029; ITMOs issued once output verified	2030 (anticipated) – first ITMOs transferred to Singapore under Article 6.2
Thailand 100 MW data-centre retrofit + Lao hydro ITMOs	9 Jun 2025 – Digital Edge / B.Grimm $1 bn JV announced	Q1 2026 → Q4 2026 fast-track build; renewable PPA finalised during fit-out	2027 – Lao hydro delivers first ITMOs once Thai registry link active	2027 – credits imported to Thailand and retired against campus load
Philippines coal-to-clean “transition-credit” deal (ACEN SLTEC)	28 May 2025 – ACEN × GenZero × Keppel framework for early coal exit	2025 – 2026 engineering & financing for solar + storage replacement	2026/27 – Verra transition-credit methodology enables first issuances	2027 – Article 6 transfer to Singapore buyers under pilot IA

What unites the trio is proof of concept. Each employs a different technology, spans a different jurisdiction and appeals to a different buyer segment, yet all lean on the same backbone of transparent registries and corresponding adjustments. If any two close before December, bankers say the pricing they set will ripple through term sheets penned in Hong Kong and Sydney.

What does this mean for Mymland?

For Mymland the implications are immediate and actionable. The heritage-conversion portfolio in Japan and the data-centres both face embodied emissions that on-site renewables cannot fully erase. A credible, liquid ASEAN credit market would let the team layer certified removals into the financing stack, lowering the weighted average cost of capital by up to sixty basis points according to term sheets now circulating among green lenders.

The Bangkok talks also influence tenant relations. Technology and life-science occupiers increasingly request lease clauses that pass through a share of building offsets so they can meet their own science-based targets. That creates a revenue opportunity: Mymland can procure credits wholesale under forward contracts then resell them within service agreements at a margin while still offering tenants a cost below open-market rates.

Closing reflection and call to action

Dawn spreads across the Chao Phraya on the final morning and boats start their slow weave toward the Gulf. Inside the conference halls negotiators exchange tired smiles yet the atmosphere is one of near completion. A decade of rulemaking has narrowed to a handful of square brackets on adjustment ledgers and benefit sharing. When those brackets drop, Southeast Asia will possess not just a market but a currency of decarbonisation that can translate ambition into balance-sheet line items.

Readers who have followed our journey from Sukhumvit coffee shops to plenary floor arguments now face a simple next step. Watch the livestream of the closing session this afternoon. Track the fee decisions and the registry linkages. Then, whether you finance factories, design apartments or manage city utilities, run your numbers again. Prices will move. Strategies will evolve. The buildings and urban systems we construct over the next five years will either be ready for a three trillion-dollar carbon economy or stranded outside it. The choice begins here in Bangkok.