Climate and environment ministers in Africa currently gathered in Zimbabwe have come up with a common set of rules to govern the fast-growing market for carbon credits.
Carbon offsets are in high demand as businesses around the world try to compensate for their greenhouse gas emissions.
The inaugural African Voluntary Carbon Credits Market (AVCCM) Forum taking place at the Victoria Falls (July 5-7) is being held under the theme ‘Accelerating Africa into Climate Economy’.
This conference is a brainchild of Africa Voluntary Carbon Credits Market (AVCCM), a local initiative that seeks to facilitate a robust, holistic and inclusive people-centric approach to the climate economy.
Carbon credits refer to the mechanism in which companies, governments and individuals make payments to enable others reduce greenhouse gas emissions on their behalf, thus allowing them to receive recognition for their contribution towards climate action.
The global market for carbon offsets is worth roughly U$2Billion and is projected to grow to as much as U$ 1Trillion in 15 years according to some estimates.
Benfits of trading voluntary carbon credits on VFEX include increased liquidity, standardisation, access to capital and transparency.
Zimbabwe’s is Africa’s third-biggest producer of credits, accounting for 13% of continental output, while Zambia is fifth-largest at 6%, according to RippleNami Inc., a data collection company that made a presentation at the conference. Kenya is Africa’s largest producer of the offsets.
Zimbabwe roiled the $2 billion global industry in May when it decreed that half of all proceeds from the offset sales would go to the state.
Kenya is now seeking to regulate the industry and Malawi has formed an agency to do the same. Zambia may follow Zimbabwe’s lead, Collins Nzovu, Zambia’s environment minister, said Thursday.
Nzovu said his government would be “very happy” with 50% of revenue, but will aim to negotiate agreements case-by-case. The country’s parliament is due to debate a Climate Change Bill during the fourth quarter as part of its push to regulate the industry.
“There isn’t as yet an established move for convergence to say, ‘lets have a uniform framework,’” said Mangaliso Ndlovu, Zimbabwe’s environment minister, in an interview at a conference in the country’s resort town of Victoria Falls. “Going forward, I want to believe there will be greater collaboration among African ministers of environment.”
