Online Reporter
The African Development Bank (AfDB) plans to establish a new carbon markets support facility aimed at unlocking climate finance across the continent, senior officials announced at the bank’s annual meeting in Abidjan.
The African Development Bank has announced plans to create the Africa Carbon Support Facility to enhance climate finance across Africa.
The initiative will assist governments in developing carbon trading policies and establish infrastructure to facilitate the trade of carbon credits. Carbon credits represent the offset of one metric ton of carbon emissions and can be traded to support global climate targets.
The initiative called the Africa Carbon Support Facility, is currently in the design phase and will feature two key components, according to the bank. The first component will help governments develop policies and regulations governing carbon trading, while the second will focus on boosting the supply and demand for credits as well as the key market infrastructure needed to increase their use, Reuters reported.
“Through this, we envision a future where carbon credits can become a tradable commodity on Africa’s stock exchanges,” said Anthony Nyong, AfDB’s director for climate change and green growth.
Carbon credits have become a big industry, with wealthier nations offsetting their emissions by either financing clean and sustainable energy projects or compensating developing economies for conserving their natural environments.
These projects earn one credit for every metric ton of carbon emissions they either reduce or remove from the atmosphere. Countries and companies can purchase these credits to help meet their climate targets.
Africa has struggled to fully capitalise on the global carbon credit market, where prices on the continent remain significantly lower than in regions with stricter regulatory frameworks. — Business Insider Africa
