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Singapore vows to be first in Southeast Asia to ditch petrol cars

City-state sets ambitious plan to fully switch to green vehicles by 2040

BlueSG electric car-sharing vehicles are parked at a charging station during their launch in Singapore.   © Reuters

SINGAPORE -- The common sight of loud, gas-guzzling Ferraris, Porsches and Lamborghinis zipping around the smoothly-paved roads of wealthy Singapore is set to become a thing of the past.

Finance Minister Heng Swee Keat said Tuesday that Singapore intended to phase out vehicles with internal combustion engines by 2040, making the city-state the first Southeast Asian country to announce a time frame for kicking petrol and diesel-powered cars to the curb.

Singapore can now join countries such as France, the U.K., Denmark and Norway in seeking to ditch gasoline-fueled cars. China is among this group, but has not set a hard deadline for a ban.

While some of these countries have proposed to ban the sale of new cars running on fossil fuels, Singapore is seeking to go a step further by having every vehicle on its roads run on cleaner energy.

"The domestic transport sector contributes a significant amount of greenhouse gas emissions," Heng told parliament. "Vehicles with internal combustion engines, or ICEs, also contribute to pollution, adversely affecting our health and quality of life."

To encourage the switch to options like electric vehicles, Heng announced an early adoption incentive. Under this plan, buyers of such cars can get up to SG$20,000 ($14,375) in rebates on government-levied fees when registering vehicles.

He said the public and private sectors will work together to increase the number of charging points for EVs from about 1,600 now to a target of 28,000 at public parking lots by 2030.

"We are placing a significant bet on EVs, and leaning policy in that direction because it is the most promising technology. It also requires a significant increase in demand to justify the infrastructure investment," Heng said.

The minister, however, did not elaborate on measures to reduce the number of existing gas-only vehicles on roads within the 20-year time frame.

Walter Theseira, associate professor and head of the Urban Transportation Programme at the Singapore University of Social Sciences, said the key issue was whether the auto industry would be ready.

"If it's not ready and there aren't enough zero or low-emissions vehicles on the market, no policy tool will work because the public will perceive a huge loss in choice and availability of cars," Theseira said.

Su Lian Jye, principal analyst at technology analysis company ABI Research, told the Nikkei Asian Review that current trends in the global auto industry are in line with the government's policy direction.

"With big markets like China, the U.S. and India all committed to EVs, it will drive car manufacturers to speed up their innovation and expand their revenue streams," he said.

Even luxury carmakers, which have traditionally made their names on selling desirable but gas-hungry machines, have developed electric options as environmentally-friendlier alternatives to their core product lines.

Satya Ramamurthy, head of Infrastructure, Government and Healthcare at audit company KPMG Singapore, said the onus of the shift to vehicles powered by cleaner energy would be on fossil fuel providers in Singapore.

He noted that energy giants such as Royal Dutch Shell started rolling out EV charging points at gas stations in the city-state last year.

"The impact on fuel suppliers will be negative, given that fuel will no longer be needed to run vehicles," Ramamurthy said. "Some of the big players are aware of the fundamental shift occurring and have already taken steps to secure their future in a decarbonizing world."

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