Sixth, the labour market will undergo a major adjustment. Jobs will be lost in traditional carbon-intensive sectors but new jobs will be created in carbon-neutral industries. It is estimated that about 200 million jobs would be created and 185 million lost globally by 2050 from a net-zero transition. There will be a period of net job losses during the transition: foundry workers will not instantaneously be transformed into building-insulation experts. Worker reskilling and redeployment will thus be crucial. Identifying skills adjacencies will be a key part of worker retraining programmes. In Singapore, a comprehensive strategy to green the economy is taking shape, with a focus on boosting energy and resource efficiency and creating good jobs. 6/9  BIS central bankers' speeches  In the petrochemical industry, all the major players have committed to reach net zero by 2050 and government agencies, industry players, and research institutes are developing capabilities in carbon capture and storage technologies. In the maritime industry, investments are being made to help our port terminals become net zero by 2050 and support the provision of low and zero carbon marine fuels such as ammonia, hydrogen, and biofuels. In road transport, Singapore aims to do away with the internal combustion engine and switch to electric vehicles by 2040. Singapore enjoys a trust premium; many emerging green services, like the trading of carbon credits and monitoring, reporting, and verifying carbon emissions, are built on trust. TRANSITION FINANCE The fourth enabler for the path to net zero is transition finance.

The transition to net zero will likely entail the biggest economic and societal transformation since the Industrial Revolution. As the environmental scientist Vaclav Smil, in his book How the World Really Works, declares rather ominously, “We are a fossil-fuelled civilization whose technical and scientific advances, quality of life, and prosperity rest on the combustion of huge quantities of fossil carbon.” To transit from such a fossil fuel civilisation to a net zero world will require considerable economic restructuring, significant technological breakthroughs, and substantial financial investments. Getting to net zero will not be easy and will require five transformative changes: a price on carbon; a shift to cleaner energy; a greening of the economy; a pivot to transition finance; a sustainable lifestyle. 2/9  BIS central bankers' speeches  CARBON PRICING A meaningful price for carbon is the single most important measure to help decarbonise the economy. A carbon price can be achieved in three ways: a tax on carbon emissions; or a system for trading emissions permits; or regulatory limits on emissions that could be translated into an implicit carbon price. Without getting the price of carbon right, most sustainability efforts will not make economic sense and not gain traction. The right price on carbon sends a powerful signal across the entire economy: it induces consumers to reduce demand for carbon-intensive goods and services; firms to move to low carbon technologies; innovators to invent and develop new low carbon products and processes; and investors to fund and commercialise them.