On April 10-12, 2025 Lutz Philip Hecker, Associate Professor of the Business School, Shenzhen Technology University (SZTU), was invited to attend the 2nd ASEAN and East Asia Carbon Market Working Group Meeting in Bangkok, Thailand. Organized by the Economic Research Institute for Southeast and East Asia (ERIA) in conjunction with the Asia Zero Emissions Center (AZEC), the meeting has been focused on the current status of carbon market development, regional cooperation, and policy innovations in ASEAN and East Asia, and invited more than thirty representatives from academia, government, and international organizations from China, Japan, Singapore, Australia, Thailand, Indonesia, Vietnam, India, Malaysia, Laos, Cambodia and other Asian countries. Based on the dialogues of the first Working Group Meeting which was held in 2024, the second meeting was organized around the core issues of "Voluntary Carbon Market (VCM)", promoting regional cooperation on "Carbon Pricing Mechanism", "Energy Saving and Emission Reduction Strategies", and "Interconnection of Regional Carbon Markets", with the aim of promoting the synergistic development of the regional carbon market, accelerating the climate action in Asia, and assisting in the realization of the Paris Agreement and the Sustainable Development Goals.

The session began with opening remarks by Dr. Naoto Okura, President of the Economic Research Institute for Southeast and East Asia (ERIA), and Dr. Nuki Agya Utama, Head of the Asia Zero Emissions Center (AZEC), who emphasized the critical role of carbon markets in the region's low-carbon transition. Representatives from China, Japan, Singapore, Australia, Thailand, Indonesia, Vietnam, India, Malaysia, Laos, and Cambodia then took the floor to analyze their experiences in carbon markets, analyze the design features and performance evaluation methodologies, and discuss the challenges of a joint ASEAN-East Asia carbon market. In terms of regional cooperation and policy recommendations, the academic presentation on "How to Connect ASEAN Carbon Markets: Learnings from the EU and China" delivered by the Associate Prof. Lutz Philip Hecker from the Business School of Shenzhen Technology University was in the spotlight. Through in-depth analysis of the experience of interconnecting the carbon markets of the EU and China, he proposed that ASEAN needs to build a "multi-level market linkage mechanism" and emphasized the importance of policy coordination and cross-border certification standards. In his report, Associate Prof. Lutz Philip Hecker comprehensively introduced the mechanism of regional carbon market interconnection, and combined with the practical experience of the EU ETS (Carbon Emission Trading System) and China's national carbon market. He put forward the four core ideas of "policy synergy", "technical standard", "incentive mechanism", and "policy coordination", which indicated that 1) ASEAN needs to establish a unified carbon market framework to avoid fragmentation; 2) ASEAN can take reference from the EU Linking Directive to formulate compatible rules; 3) It is suggested that regional carbon market pilots could be carried out in financial hubs such as Singapore, Malaysia and China, and then gradually expanded to the whole East and Southeast Asian region. This academic report has provided an actionable road map for the ASEAN carbon market to move from decentralized to interconnected, and is particularly valuable as a guidance for emerging markets such as Cambodia, Laos and Vietnam etc.

The 2nd ASEAN and East Asia Carbon Market Working Group Meetinghas injected new momentum into the synergistic development of carbon markets in ASEAN and East Asia through cross-regional experience sharing and in-depth discussions. The academic report presented by the Associate Professor Lutz Philip Hecker, from the Business School of Shenzhen Technology University was one of the core outcomes of the meeting for its pragmatic analysis of policy design and implementation pathways, which is expected to promote the regional carbon market from conceptualization to substantive cooperation.

Image and Text Provider: Lutz Philip Hecker