Going forward, I would not be surprised to see Puerto Rico’s exports rise further as your companies take advantage of the opportunities presented by the rapidly emerging economies. At your upcoming forum and summit, you’ll learn more about how to develop export markets for your products. I applaud your efforts to do so, as an important component of sustaining the vigor of the economic recovery in Puerto Rico. The long view and the New York Fed’s role Although the signs I’ve mentioned suggest that the recession is over, the road to sustained economic growth is likely to be challenging in the near term. In its favor, Puerto Rico has some important intrinsic advantages. These include natural beauty, a hospitable climate and unique status as a major U.S. economic and population center in the Caribbean. Perhaps just as important, the island has a relatively well-educated workforce. Research shows quite convincingly that abundant human capital is an important ingredient for a thriving economy. We at the New York Fed aim to do our part to help sustain growth in the Commonwealth. For example, we co-sponsor a financial awareness video competition for college students here and the Community Reinvestment Act Week activities with the Puerto Rico Bankers Association. And, as a member of the Alliance for Economic and Financial Education we promote economic and financial education via teacher training, a high school economic competition, and a speaker series. The New York Fed also has several ongoing programs of technical assistance in Puerto Rico.
This is where a robust carbon market comes in. Carbon credits are essentially tradable certificates that represent the reduction, avoidance, or removal of a certain amount of emissions from the atmosphere. Firms can buy these credits to offset hard-to-abate emissions. To efficiently match the demand for carbon credits with the supply of these credits, we need a robust carbon market. In so doing, a carbon market becomes an important mechanism to channel funds to the emission reduction and removal projects that generate the carbon credits. Adopting a twin strategy of reducing and offsetting carbon emissions is a practical and effective way to reach our climate goals in time. Given Asia’s transition needs, a well-functioning carbon trading ecosystem is particularly relevant to the region’s decarbonisation effort. There are two types of carbon markets: The compliance carbon markets support the trading of emission allowances by entities subject to mandatory targets set by national, regional or international emissions reduction regimes. The voluntary carbon markets, on the other hand, are not tied to emissions trading systems or regulatory requirements. Any company or individual can purchase carbon credits to offset their own carbon footprint voluntarily. In our journey towards a greener world, voluntary carbon markets are expected to play a more impactful role. First, the voluntary market can cater to a wider group of firms and individuals. Emissions trading systems tend to cover sectors with higher emissions and so not all firms participate in the compliance carbon market.