Deputy Minister Narend Singh: Carbon Mitigation Approaches, Organisation for Economic Co-operation and Development

Address by Deputy Minister Narend Singh during the inclusive forum on Carbon Mitigation Approaches (IFCMA), Organisation for Economic Co-operation and Development (OECD)

Acknowledging, the hosts:

• OECD Secretary-General Mathias Cormann
• OECD Deputy Secretary-General Fabrizia Lapecorella

Excellencies:

• Mr II-Young OH, Deputy Minister of Climate, Energy and Environment, Republic of Korea

Acknowledging panel members:

• Ms Andrea Hurtado, Director-General, Climate Action Policy,

Mexico

• Mr Eyup Kaan Morali, Head of Carbon Pricing, Ministry for Environment, Urbanization and Climate Change, Türkiye
• Ms Jennifer Smookler, Deputy Director, Department for Energy Security and Net Zero, United Kingdom
• Mr Jacob Werksman, Principal Advisor, DG Clima, European Commission

Members of the Diplomatic Corps,

Member State Representatives,

Greetings to you.

Due to the ongoing geopolitical tensions, fragmentation of international trade and investment flows, and persistent uncertainty, it is recognised that countries may recalibrate climate mitigation strategies to balance an increasingly complex set of policy objectives, including energy security, industrial competitiveness and strategic autonomy.

As governments around the world pursue different approaches in responding to these emerging issues, new international spillovers may emerge, with implications for greenhouse gas emissions, carbon leakage, trade and investment patterns, sustainable and inclusive economic growth, incentives to innovate, and technology diffusion.

The imposition of high trade tariffs and reciprocity measures imposed by some countries, invariably has impacts on others, particularly exporting countries at the domestic level. Entire value chains have been impacted upon. Many business operations have been disrupted, whilst they are grappling with soaring input costs such as fuel and fertilizers.

Policies such as Carbon Border Adjustment Mechanism (CBAM) has also impacted on exports of certain commodities, particularly in developing countries such as South Africa, which are still transitioning to an inclusive, climate resilient low carbon economy.

I would also want to emphasise that these are happening when many developing countries are facing fiscal constraints, where the cost of servicing debt is of key concern. Therefore, access to affordable finance to support the Just Transition and building climate resilience remains a critical enabler.

South Africa has taken several steps to create an enabling policy environment that will facilitate the transition of our economy in a manner that is low carbon, inclusive and climate resilient. Identifying the risks and challenges is key to understand what measures need to be put in place and also, what opportunities these may create.

In a developing country context, we also need to be cognisant of the need to develop new skills across value chains, recognize funding gaps, mobilize necessary capital investment, and ensure that the supporting infrastructure is equally enabling to grow the economy in a sustainable and inclusive manner.

Moreover, engagement with affected stakeholders and communities to ensure awareness and buy-in on required policy shifts and to identify capacity building requirements associated with the Just Transition is of paramount importance. The potential opportunities that can be created through the transition also need to be communicated.

South Africa's Climate Change Act was promulgated in 2024. Chapter Five of the Climate Change Act addresses industrial decarbonization. We have consulted with companies, which trigger in excess of 30 000 tonnes of carbon emissions equivalent (CO2 eq.), per annum, in preparing companies for the Carbon Budget Regulations. Companies need to put mitigation plans in place and report on progress, on an annual basis. This is a significant intervention in transitioning Industry in reducing emissions.

We have also been working closely with other spheres of government, more specifically local government, to undertake risk and vulnerability assessments and assist municipalities with developing Climate Change response plans. The end goal, being, to enhance adaptive capacity and build climate resilience.

Recently, the Department of Trade, industry and Competition, launched the Industrial Development Strategy (IDS) for South Africa. The Strategy aims at addressing decarbonization of industry through uptake of cleaner technology, and new energy systems, economic diversification through beneficiating value chains and digitalization. Product and market diversification is a long-term goal. By the same token, we must also ensure inclusivity and, in this regard, small business need to be part of the solution.

In conclusion, as South Africa, we remain committed to the targets as set in the 2025 updated Nationally Determined Contribution (NDC), and the implementation of the Climate Change Act of 2024. We look forward to developing and nurturing enabling partnerships both internationally and domestically to support these important processes.

I thank you.

#ServiceDeliveryZA