Brunei may study the idea of grouping with its Heart of Borneo (HOB) partners Malaysia and Indonesia to join the global carbon trading market where it could leverage on its rich forest cover, said Deputy Minister of Industry and Primary Resources.

"The immediate challenge now would be Copenhagen, and we need to somehow position ourselves so we can make a joint statement with Malaysia and Indonesia," said Dato Paduka Hj Hamdillah Hj Abd Wahab yesterday.

Dato Paduka Hj Hamdillah, who during the recently concluded 16th Asia Pacific Economic Cooperation (APEC) SME Ministerial Meeting in Singapore announced that Brunei will leverage on its "excellent position as one of the top five countries in the world with most forestry coverage through carbon trading", said it is critical that Brunei joins its HOB partners because of the economy of scale the green initiative brings to the fore.

"On its own, Brunei is less than two per cent of the 220,000 square kilometres of rainforest found in the HOB. Brunei could take the lead without being a leader, and I'd rather suggest that Brunei assume its role as a beacon of the HOB as opposed to being a leader in conservation, eco-tourism and eco-trading," said the deputy minister.

Carbon trading essentially allows industries in developed countries to off-set their carbon dioxide emissions by investing in reforestation and clean energy projects in developing countries.

According to the Bali Action Plan, a new binding agreement to reduce greenhouse gas emissions will be finalised at the 15th Conference of Parties of the United Nations Framework Convention on Climate Change in Copenhagen in December to supersede the Kyoto Protocol, which is set to expire in 2012.

Emerging giants such as China and other developing countries say the new agreement should strengthen Kyoto, under which 37 highly industrialised nations took on hard commitments for cutting carbon dioxide pollution between 2008 and 2012.

Being a signatory to the Kyoto Protocol is one of the main requirements for a country to enter the global carbon market, and Brunei has already done so earlier in August this year, according to Dato Paduka Hj Hamdillah.

Adam J Tomasek, leader of the HOB initiative under the World Wildlife Fund (WWF), said the WWF launched a report two weeks ago during a UN meeting on climate change in Bangkok that brought together investors who had a potential investment of US$7 trillion, and surveyed them on the requirements for a carbon trading system.

"We're working directly with them in a way to understand how a compliance market, not just a voluntary market, can really provide tangible economic returns," said Adam following a working luncheon with HOB committee members and senior government officials at the British High Commissioner's residence in Kota Batu yesterday.

"In a way Brunei plays a critical role in terms of offsetting carbon emissions from Malaysia and Indonesia (where deforestation contributes 60 and 80 per cent to their carbon emissions respectively), but also in retaining an objective, political view about the need to make sure the three countries together stand up and take account of what they can actually do to address deforestation and carbon emissions," he said.

To date, 76 per cent of Brunei's land area of 5,765 sq km is covered by forest. The HOB is a tri-country declaration that aims to conserve and sustainably manage what the WWF says is one of the most important centres of biological diversity in the world, covering approximately 220,000 sq km of equatorial rainforests, which is almost a third of the island.