BUSINESS REPORTER
African countries could unlock US$82bn in the carbon credit market to propel industrialisation and economic diversification, the Economic Commission for Africa acting executive secretary Antonio Pedro has said, as continent gets access to new source of financing.
The call to use certificates representing one tonne of CO2e that has either been prevented from being emitted or removed from the atmosphere comes as Africa is battling to fund its industrialisation drive and capitalise on a bigger market created by the African Continental Free Trade Area (AfCFTA).
Pedro (pictured) believes carbon credits could allow access to previously untapped financing, although “it is not the panacea”.
“For example, on sustainable financing and climate action, we know that carbon credit markets could bring in a whopping US$82bn for Africa,” Pedro said in his opening remarks at the 55th ECA Conference of African ministers of Finance, Planning and Economic Development.
He said ECA was working with countries wishing to implement carbon certification and accreditation processes to access carbon credit markets.
At COP27 in Egypt, the Africa Carbon Markets Initiative (ACMI) was launched to drive voluntary carbon markets across Africa by scaling the market to 300 million carbon credits retired annually by 2030, and 1.5 billion credits annually by 2050. The ACMI seeks to unlock US$6bn in revenue by 2030 and over US$120bn by 2050.
It is projected that the ACMI will support 30m jobs by 2030 which will more than treble to 110m jobs by 2050.
To date, 7 countries have signed up to the ACMI. The countries are Kenya, Malawi, Mozambique, Togo, Nigeria, Burundi and Rwanda.
The ACMI was launched in collaboration with The Global Energy Alliance for People and, Sustainable Energy for All and the ECA with the support of the UN Climate Change High Level Champions.
There are two types of carbon markets: compliance markets and voluntary markets. In compliance markets, companies and governments must account for their greenhouse gas emissions as required by regulation.
In voluntary markets, a project developer sets up a project that avoids certain emissions such as landfill gas treatment and management or removes CO2e from the atmosphere.
