This year’s haze is set to cost Singapore more than 2015’s S$1.83 billion. Who pays for the losses?

Nature & Climate Perspective

**Catastrophic peatland fires driving transboundary haze severely compromise regional LULUCF integrity and trigger systemic permanence failure across regional carbon stocks. **

• Subterranean peat combustion causes catastrophic biodiversity loss and habitat fragmentation across Southeast Asian tropical forest biomes.
• The massive release of sequestered carbon from burning peat stores directly undermines the ICVCM Core Carbon Principles (CCPs) requirement for permanence and uncompensated reversal risk mitigation.
• Persistent particulate emissions and topsoil destruction degrade regional hydrological buffers, lowering the long-term environmental stability and climate resilience of local wetlands.

Market & Policy Outlook

**Transboundary economic damages exceeding S$1. 83 billion are accelerating cross-jurisdictional liability and tightening supply chain compliance across regional capital markets.**

• Extraterritorial enforcement under Singapore's Transboundary Haze Pollution Act exposes agricultural concessions to sovereign legal action, jeopardizing bilateral Article 6.2 ITMO eligibility for host nations.
• Mounting municipal and commercial losses of up to US$12.3 million daily depress productivity, increasing the cost of capital and carbon insurance premiums for regional nature-based assets.
• Downstream commodity buyers face severe compliance friction under SBTi Forest, Land, and Agriculture (FLAG) guidance, as unaddressed fire events in upstream supply chains trigger material Scope 3 non-compliance.