23 April, Washington DC, USA — Climate-vulnerable nations from across Africa, Asia, the Caribbean, Latin America, and the Pacific convened to spotlight concrete steps they are taking to harness high-integrity carbon markets as a driver of economic resilience and climate prosperity, demonstrating that they are not waiting for climate finance to arrive, but actively building the architecture to attract it.

The event was convened by the Climate Vulnerable Forum and V20 Finance Ministers (CVF-V20) and VCMI on the sidelines of the Spring Meetings of the World Bank and the International Monetary Fund (IMF).

Ambassador H.E. The Most Honourable Elizabeth Thompson, Sherpa to Prime Minister Mia Amor Mottley of Barbados, Chair of the CVF-V20, set the tone for the discussions, underscoring that carbon finance is one of the super levers to catalyze finance in climate-vulnerable countries, with the potential to  “unlock an additional US$20 billion by 2030, which can be used to support the climate prosperity agenda and boost nature-based solution investments.”

CVF-V20 Nations Showcasing Action

Earlier this year, Bhutan launched the Carbon Market Information Platform, designed to enhance transparency, reduce transaction costs, and strengthen carbon credit integrity. The platform includes a first-of-its-kind, interactive private sector engagement manual to help private participants navigate key sections of Bhutan’s carbon market guidance. 

“Bhutan’s approach focuses on bridging the gap between frameworks and a functioning market by developing a credible pipeline of activities, strengthening institutional coordination, and engaging early with sovereign and private sector buyers,” H.E. Lyonpo Lekey Dorji, the Minister of Finance of The Kingdom of Bhutan, said. 

Ghana is among the most advanced CVF-V20 countries at mobilizing finance under Article 6 of the Paris Agreement. 

“Several projects on the National Carbon Market Pipeline include Ghana Forest Investment Program which is expected to generate 10 million carbon credits, the Ghana REDD+ Program which targets 5 million carbon credits, and the Solar Irrigation Project which is estimated to gain two million carbon credits,” H.E. Issifu Seidu, the Minister of State for Climate Change and Sustainability of the Republic of Ghana, cited.

H.E. Tiaone Hendry, Chairperson of the Natural Resources, Energy and Climate Change Committee of the Parliament of Malawi, stressed that strong legislative foundations are non-negotiable as carbon projects begin to scale in her country. “Parliamentary engagement is not optional. It is essential,” she said, noting the ongoing questions around legal frameworks, benefit-sharing, and community rights.

The esteemed parliamentarian made it clear, “Success will not be measured by the number of carbon credits generated. It will be measured by whether livelihoods are improved, whether communities see tangible benefits, and whether revenues are clearly contributing to national development.” She warned about avoiding a situation where carbon becomes another extractive industry, and highlighted the vital role of parliamentarians to ensure the interests of their constituents are heard in emerging legislation.

Mr. John Narag, Director at the Philippines’ Department of Finance, presented the country’s newly adopted Roadmap to Readiness in the Voluntary Forest Carbon Market, establishing a strategic framework spanning policy development, data analytics, institutional mechanisms, and sustainable financing for forest carbon. He also shared that the Philippines, as the current ASEAN Chairman, will host a Carbon Market Forum for the region in September 2026 to help advance carbon market initiatives across the country and the wider region.

Pakistan, meanwhile, announced the signing of its first-ever carbon market deal—another milestone following the launch of its National Policy Guidelines for Trading in Carbon Markets. Zulfiqar Younas, Additional Secretary and Member of the Federal Board of Revenue in Pakistan, highlighted the country’s plans to scale investment-ready project pipelines across key sectors, including water, transport, industry, agriculture, forestry, and other land uses.

Participants at the Carbon Finance Program workshop

Addressing Bottlenecks, Enabling Market Conditions

Despite rising momentum, significant barriers remain. The 45 least developed countries globally accounted for just 1.5 percent of all projects registered under the Clean Development Mechanism. Without significant technical support, there is a significant risk that this pattern will repeat under Article 6, with those countries that most need the carbon market finance that is available unable to access it. Discussions identified low technical capacities, fragmented institutional uptake and coordination, accounting challenges, regulatory uncertainty, and social safeguards as the principal constraints holding both countries and private sector investors back.

”Countries need to take ownership of carbon market initiatives. An appropriate legislative framework and fiscal infrastructure are needed to ensure efficiency in carbon market engagement and management,” Sara Jane Ahmed, Managing Director and Finance Advisor of the CVF-V20 Secretariat, said. 

The technical session, the first of three to be delivered this year, examined what policy and regulatory conditions are needed to unlock Article 6 and voluntary demand for high-integrity carbon credits at scale.

“The world cannot achieve its climate targets without dramatically scaling up flows of finance to climate-vulnerable nations. As carbon markets grow, it is vital that climate-vulnerable nations are well equipped to leverage these channels of finance to support domestic priorities and global goals. VCMI’s partnership with the CVF-V20 is already building the foundations for high-integrity carbon markets that support climate prosperity across the CVF-V20 membership,” Mark Kenber, Executive Director of VCMI, said.

VCMI has launched the Carbon Markets Access Toolkit that political leaders and key market actors from host countries can use to decide whether and how to engage with regulated and voluntary carbon markets, as well as those facilitated under Article 6 of the Paris Agreement.

As the global carbon market continues to grow, the CVF-V20 Secretariat and VCMI will continue empowering climate-vulnerable countries with knowledge, tools, and capacity-building activities on the development of robust carbon market infrastructure that attracts investment.  

Notes to editor

• This event forms part of the workshop series under VCMI and CVF-V20’s Carbon Finance Program, designed to support CVF-V20 member countries in leveraging high-integrity carbon markets to finance their Nationally Determined Contributions (NDCs) and Climate Prosperity Plans (CPPs). 
• CPPs are nationally owned multi-phase investment strategies that reframe climate vulnerability as a socio-economic and development challenge that can be solved through well-structured, growth-generating investment. They are built around bankable pipelines of investment opportunities, grounded in macroeconomic realities and implemented through delivery structures known as Country Platforms, typically anchored in Ministries of Finance. These platforms coordinate line ministries, development banks, and capital mobilization institutions under a single architecture.
• With 83 percent of NDCs expressing interest in international market mechanisms, Article 6 of the Paris Agreement is emerging as a critical enabler for raising climate ambitions. Scaling carbon markets through high-integrity projects could halve the cost of capital needed to implement NDCs, CPPs, and broader development plans. 
• A 2025 report by CVF-V20 and Bridgetown Initiative identified ten ‘super levers’ that will create multiplier effects, mobilising hundreds of billions of dollars of desperately-needed financial resources to countries on the frontlines of the climate crisis. One of these super levers is scaling and standardizing carbon markets by implementing high-integrity carbon pricing in ways that help protect and enhance nature, including a robust Article 6 mechanism and G20 countries purchasing international credits to raise carbon market funds for vulnerable countries.

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The transition to resilient agriculture is at an inflection point – one that could translate lessons learned in Latin America and the Caribbean (LAC) into global climate and food security solutions.

The LAC region is ready to lead the transition to climate resilient agriculture, but finance is needed, and fast

LAC boasts a proud and highly skilled workforce of smallholder farmers whose livelihoods are being threatened by climate change. The region’s unique biodiversity and abundant biomass is capable of supporting climate resilient bioeconomy models, with strong potential in agroforestry and regenerative livestock systems, but only if finance is made available, and fast.

Recent data reveals a growing recognition of the need to finance climate resilient agriculture, but a concerning mismatch between flows of finance and the regions that need it most. From 2021-2022, global climate finance for agrifood systems tripled, reaching USD 94.9 billion,[1] but just 5% of total funding (about USD 6 billion) went to LAC, where agriculture accounts for 55% of emissions. To build sustainable agricultural solutions and rural resilience, the region needs a 27x increase in funding: USD 160 billion annually through 2050.

This imbalance in public finance for climate resilient agriculture is unfolding amid mounting fiscal constraints. In Central America, for instance, agricultural budgets have declined by an average of 8.57% annually over the past decade, and this decline could increase to up to 15% annually by 2030.

The conclusion is unavoidable: the region cannot rely solely on public finance to deliver the transition to climate resilient agricultural practices. Private finance must be part of the solution.

High-integrity carbon markets are well poised to catalyze the transition

With limited public finance on the table, high-integrity carbon markets can support LAC’s transition to climate resilient agriculture – driving regional impact, and developing a blueprint that the rest of the world can follow. Recent trends point to growing demand for carbon markets – including the acceleration of Article 6 agreements and approved methodologies – laying the groundwork for scaled transactions.[2]

Agriculture-based credits are also attracting a higher value – prices rose by 18–20% in 2024[3] – and surging retirements indicate increasing private-sector appetite.[4] But there is a risk that the opportunity presented by this growing demand for agriculture-based credits is not effectively leveraged in LAC, or other global south markets due to fragmented development of the market.

Carbon credit markets have historically developed project by project, but this model alone cannot mobilize the scale of finance required for the transition to climate resilient agriculture. Rather than isolated projects, investors increasingly seek system-level coherence, with markets underpinned by government-led frameworks that reduce risk, aggregate supply, and ensure environmental integrity. To lead the transition, LAC needs to transform carbon markets from fragmented credit generation into structured investment platforms that can mobilize debt-free finance that helps governments and farmers catalyze the sector’s just transition.

Governments need support to leverage catalytic carbon finance for climate resilient agriculture

To achieve this, governments must lead the way. A scale-up approach to agricultural carbon markets – characterized by national carbon project inventories, robust territorial or sectoral MRV systems, benefit sharing frameworks, and the integration of carbon markets within national climate strategies – is essential.

For institutional investors, development finance institutions, and corporates with long-term supply chain exposure, scale-up approaches reduce transaction costs and enhance confidence. They also serve to create the enabling environment for catalytic capital – such as blended finance, guarantees, and results-based payments – which can deliver a multiplier effect on top of carbon revenues, supporting climate resilient growth, strengthening rural incomes, enhancing smallholder resilience, and improving international competitiveness.

But designing scale-up approaches for agricultural carbon markets requires significant institutional capacity and tailored expertise within governments. Analysis by the Partnership for Agricultural Carbon (PAC) indicates that several Latin American countries, including Brazil, Colombia and Peru, could attract more finance by enhancing ‘investment readiness’ for agricultural carbon markets.

The challenge is therefore how governments in LAC – and beyond – can build and position carbon credit markets as structured investment platforms for delivering climate resilient agriculture. Promising developments in LAC are already underway:

• Peru’s Ministry of Agricultural Development and Irrigation [5] to promote participation of the sector in carbon markets and help famers access climate finance through high-integrity carbon credits.
• Paraguay and Peru are also front runners in Article 6 implementation, signing bilateral cooperation agreements with multiple countries, including partnerships with Singapore, which cover generation of carbon credits from sustainable grazing and rice methane reduction.
• Bolivia has recently started work on a national regenerative agriculture and livestock program intended to support climate mitigation in the agricultural sector. The initiative will establish the systems needed to measure soil carbon changes across large agricultural areas, laying the foundations needed for future carbon projects.

To take the role of carbon markets in the climate resilient agriculture transition across the LAC region, and worldwide, governments need tailored support. VCMI’s Access Strategies Program is designed to find and fill gaps in carbon markets participation around the world. Through the Program, the Partnership for Agricultural Carbon (PAC) has been supporting governments across LAC to build the institutional conditions needed to effectively leverage high-integrity carbon finance mechanisms in support of climate resilient agricultural solutions, through diagnostics, readiness frameworks, policy tools, and capacity-building programs that translate ambition into action. PAC is the only expert-led, international initiative dedicated exclusively to supporting governments and farmers to access the power of carbon markets for climate resilient agriculture.

With coordinated support, Latin America and the Caribbean can be a laboratory for the global transition to climate resilient agriculture

With coordinated support for governments to pioneer large-scale agricultural carbon markets, Latin America and the Caribbean has the potential to position itself as a strategic partner in delivering sustainable and adaptive agrifood systems for the world.

By prioritizing readiness and piloting innovative approaches Latin America and the Caribbean can be a ‘global laboratory’ for scaling high-integrity, market-ready approaches that fast track the transition to a more resilient agricultural sector. Other regions with rich natural capital and large-scale agriculture economies can follow in its footsteps.

The opportunity is clear. Agriculture cannot remain the underfunded frontier of climate action. If LAC can build the institutional readiness needed to scale high-integrity agricultural carbon markets, it will not only attract transformative investment but redefine the entire sector’s role in the global climate transition.

About the Partnership for Agricultural Carbon 

• The Partnership for Agricultural Carbon (PAC) is the only expert-led, international initiative dedicated exclusively to supporting governments and farmers to access the power of carbon markets for sustainable agriculture.  

• PAC is incubated and operationalized through VCMI’s Access Strategies Program, which supports countries to meaningfully participate in, and benefit from, high-integrity carbon markets. 

• PAC accelerates investment in agricultural carbon markets by supporting governments and famers to deliver clear, enabling policies, robust MRV systems, and effective local impact plans that build confidence amongst private sector investors.  

[1] Climate Policy Initiative’s (CPI) Landscape of Climate Finance for Agrifood Systems 2025

[2] Climate Focus report

[3] 2025 State of Voluntary Market report

[4] 2025 State of Voluntary Market report

[5] Guide to promote the participation of producers in the Agricultural and Irrigation sector in the Voluntary Carbon Market

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The guide, produced as part of VCMI’s Access Strategies Program, is designed to help governments and financial authorities test and refine carbon market regulations in a controlled, evidence-based way.

Carbon markets hold significant potential for financial innovation and growth. Voluntary carbon markets are projected to reach US$ 5–20  billion by 2030 and US$ 60–270 billion by 2050. However, carbon markets are constrained by structural challenges such as inconsistent credit quality, limited transparency, high transaction costs, and regulatory uncertainty. These obstacles undermine market confidence and limit the flow of capital to high-impact climate-mitigation projects. However, there is a lot that regulators can do to reduce such risk and create a positive enabling environment for investors, buyers, and project developers.  

To support the establishment of regulatory frameworks that balance financial innovation, environmental integrity, and risk protections for investors and consumers, CCA and VCMI have developed a guide on the use of regulatory sandboxes: a practical tool that allows governments to trial regulatory approaches to carbon finance before committing them to law.

Regulatory sandboxes provide controlled live environments for testing innovations such as carbon-credit linked bonds, securitized carbon transactions, blockchain carbon registries, AI-driven monitoring systems, and tokenized credits while maintaining environmental integrity and investor protection.

“Carbon markets hold significant opportunities for climate-positive growth in emerging markets and developing economies, but accessing growing demand for carbon credits requires specialist knowledge and tailored policies and regulations that have been tested in real world contexts,” said Mark Kenber, Executive Director of VCMI. “This guide provides policymakers with a transformational tool to drive innovation in carbon markets, while upholding environmental and social integrity through robust oversight. This can help EMDEs to accelerate credible climate finance solutions and position themselves as investment-ready sources of high-quality carbon credits.” 

The guide provides a step-by-step framework for designing and implementing regulatory sandboxes tailored to national legal and institutional contexts. It offers practical guidance on how to assess the impact and safety of innovations while managing risks, including through governance mechanisms, risk controls, stakeholder roles, and technical considerations.

“Innovation in the clean cooking sector is advancing rapidly, and regulatory clarity will be critical to unlocking investment,” said Dymphna van der Lans, CCA CEO. “Regulatory sandboxes give policymakers a practical way to test new approaches, build confidence, manage risk, and protect the integrity of carbon markets.”

“With many countries across Africa aiming to develop their carbon markets and become investment-ready, this guide offers timely and practical guidance to help financial institutions regulators develop carbon regulations that fit country contexts,” said Reshma Shah, Carbon Markets Lead at FSD Africa.

While the guide draws on practical experience from carbon markets linked to clean cooking and household energy access, it is intentionally designed for broad applicability across countries, technologies, and carbon market segments. It builds on previous work by CCA, including a report and policy brief on “Financial Regulatory Pathways for Scaling Carbon Markets.”  Collectively, these resources are guiding CCA’s ongoing support to regulators in Kenya, with similar efforts underway in Nigeria.

“Unlocking carbon finance is vital for climate resilience and sustainable development across West African countries and communities,” said Ousmane Fall Sarr, Coordinator of the West African Alliance on Carbon Markets and Climate Finance. “This resource  can help regulators build and test the necessary enabling conditions for market growth.”  

The “Regulatory Sandbox to Support Carbon Markets” guide is intended for:

• Capital markets authorities
• Financial regulators
• Central banks
• Climate finance innovators
• Carbon project developers
• Economic development partners 

The guide is now publicly available in English and will soon be available in French. 

Download the guide here. 

About the Clean Cooking Alliance
The Clean Cooking Alliance (CCA) works with a global network of partners to build an inclusive industry that makes clean cooking accessible to the 2.1 billion people who live each day without it. Established in 2010, CCA is driving consumer demand, mobilizing investment to build a pipeline of scalable businesses, and fostering an enabling environment that allows the sector to thrive. Clean cooking transforms lives by improving health, protecting the climate and the environment, empowering women, and helping consumers save time and money.

About the Voluntary Carbon Markets Integrity Initiative

The Voluntary Carbon Markets Integrity Initiative (VCMI) is an international non-profit committed to realizing the full potential of high-integrity voluntary carbon markets (VCMs). VCMI’s mission is to empower companies, governments, and non-state actors to maximize their climate impact through the use of high-quality carbon credits. 

The ‘Regulatory Sandbox to Support Carbon Markets’ guide was produced as part of VCMI’s Access Strategies Program, which supports host countries, regions, and sectors to participate in high-integrity carbon markets and unlock the environmental, social, and economic benefits of carbon finance within national climate plans. This program is instrumental in building the necessary infrastructure for countries to participate meaningfully in and benefit from the global carbon market. 

About FSD Africa

FSD Africa is a specialist development agency established in 2012 by the UK Government working to make finance work for Africa’s future. FSD Africa works on the ground in over 30 African countries to mobilise “green plus” finance that will power economic and social development while delivering environmental gains and building Africa’s resilience. FSD Africa works on policy and regulatory reform, capacity strengthening and improving financial infrastructure, and addressing systemic challenges in Africa’s financial markets to spark large-scale and long-term change.

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26 February, London – A new playbook sets out steps to fill the gap for Africa-based validation and verification bodies and improve the efficiency of the continent’s carbon credit market and unlock socio-economic benefits. 

 Pathways for Strengthening Validation and Verification Body (VVB) Capacity in Africa highlights that Africa still relies on international VVBs and non-African auditors for more than 90 per cent of carbon project verification activities. Project developers estimate that between 10 and 50 per cent of total project delays and cost overruns are attributable to VVB bottlenecks. 

The report, produced by Perspectives Climate Group,​ ​​​​was commissioned by the Voluntary Carbon Markets Integrity Initiative (VCMI) for its Access Strategies program, and German Agency for International Cooperation, GIZ as part of its Global Carbon Market Project. The Eastern Africa Alliance on Carbon Markets and Climate Finance, and the West African Alliance on Carbon Markets and Climate Finance, have supported the report’s findings. 

Africa issued approximately 12.2 million carbon credits in 2024, with voluntary market issuance comparable to that of Asia. However, a lack of VVBs in Africa results in higher transaction costs and limited local ownership and economic benefits, while demand for carbon credits is expected to continue to rise. The report outlines that strengthening Africa’s VVB ecosystem would deliver a range of climate, economic and social benefits including reduced greenwashing risks, more green jobs and greater retention of the value of carbon markets within African economies. 

“Demand for validation and verification services is expected to rise significantly by 2030, as countries implement activities under the Paris Agreement’s Article 6 mechanisms and governments drive consistent guidance on corporate use of carbon credits as part of credible decarbonization plans,” said Mark Kenber, Executive Director of VCMI.

“Building Africa’s capacity to validate and verify emissions reductions through carbon credit projects is fundamental for fulfilling its potential to meet rising demand for high-integrity carbon credits and to ensure that the value of these services remains on the continent. The opportunity cost for the continent is considerable – without coordinated action to scale Africa-based VVB capacity, Africa risks losing out on approximately USD $ 1 billion of economic benefits over five years.” 

Despite strong potential, Africa’s carbon credit market, representing about 11 per cent of global issuance, has tapped only two per cent of its maximum capacity, the report finds. 

VVBs play a central role in carbon markets, providing independent assurance that emission reductions and removals are real, additional, permanent, and properly monitored. VVBs are therefore essential to the credibility of African credits for voluntary and compliance uses.  

“The supply of carbon credits in Africa has increased significantly in recent years, but it continues to represent a fraction of retirements globally,” said Andrew Ocama, Coordinator of the Eastern Africa Alliance on Carbon Markets and Climate Finance.  

“An understanding of local context is important for auditing community related projects, which form the majority of projects in Africa. This report is a welcome resource that will guide countries in Eastern Africa and beyond looking to bolster domestic audit infrastructure for high-integrity carbon markets and reduce reliance on international auditors.” 

The report authors call for a phased and coordinated approach, moving from rapid deployment of Africa-based auditors in the near-term to the establishment of durable African VVB institutions in the longer term, through accreditation and training pathways, targeted de-risking of private sector investment, and integration of digital monitoring, reporting and verification tools. 

“For Africa to fully participate in high-integrity carbon markets, it must build the systems and structures that underpin them. Validation and verification are core market infrastructure. Strengthening this capacity locally is essential for credibility, competitiveness, and climate sovereignty,” said Ritah Rukundo, Manager of the Global Carbon Market Project at GIZ. 

“This report clearly shows that addressing this gap and ensuring carbon markets deliver critical climate finance and wider economic and community benefits for Africa will require coordinated action across policy, institutions, workforce development, and financing.” 

The nine priority actions identified by the report include: 

1. Providing clear policy signals on the role of carbon markets in Nationally Determined Contribution implementation and embed VVB functions within national Measurement, Reporting, and Verification (MRV) frameworks.

2. Strengthening regional and national accreditation and training pipelines aligned with ISO standards and priority sectors in the African project pipeline.

3. Harmonizing regional training-to-accreditation pathways as a structural precondition for scaling with integrity, including mutual recognition where feasible.

4. Rapidly scaling Africa-based auditors’ engagement in VVB services for carbon market activities through co-auditing, mentorship, and permanent regional audit teams.

5. Improving and addressing auditor retention and career progression through demand-linked professional pathways.

6. Deploying targeted financial de-risking instruments to address accreditation costs, working capital needs, and early-stage risk.

7. Exploring durable domestic financing options such as allocating a share of proceeds from carbon levies to fund verification capacity, reducing dependency on short-term donor cycles, and aligning incentives for market credibility.

8. Integrating digital MRV tools as efficiency-enhancing complements within robust institutional and accreditation frameworks.

9. Embedding inclusivity pathways throughout all priority actions such as targeted outreach and scholarships for women and under-represented groups, multilingual materials and delivery, and deliberate representation of least developed countries and smaller markets within regional hubs.

“Africa’s rapidly growing carbon markets are constrained by a critical shortage of local validation and verification capacity. As demand for carbon credits increases, Africa’s reliance on international auditors leads to higher costs, delays and limited local value creation,” said Sergi Cuadrat, Managing Director for Carbon Markets at Perspectives Climate Group. 

“Beyond identifying practical pathways to strengthen VVB capacity, the report has informed the design of a strategic accelerator concept to translate evidence into implementation. The accelerator combines targeted policy coordination, accreditation training, supervised audit deployment and catalytic financial instruments to scale high-integrity, Africa-based VVB capacity. By addressing systemic bottlenecks rather than isolated skills gaps, it provides a credible roadmap to unlock private investment and strengthen institutional resilience across Africa.” 

​“Communities across West Africa stand to gain significantly from a mature and well-regulated carbon markets ecosystem. Building strong VVB capacity will not only create skilled green jobs, but also ensure high-integrity carbon projects are designed, implemented, and audited with African priorities at the forefront. This report sets out the critical actions required to scale VVB capacity and unlock the full climate and economic potential of carbon markets,” said Ousmane Fall Sarr, Coordinator of the West African Alliance on Carbon Markets and Climate Finance   

Ends 

About VCMI 

The Voluntary Carbon Markets Integrity Initiative (VCMI) is an international non-profit organization with a mission to enable high-integrity voluntary carbon markets (VCMs) that deliver real and additional benefits to the atmosphere, help protect nature, and accelerate the transition to ambitious, economy-wide climate policies and regulation. 

https://vcmintegrity.org/ 

About GIZ 

The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH is a German federal company with over 50 years of experience in technical cooperation across a broad range of areas, including economic development and employment promotion, energy, environment and climate change, and peace and security. GIZ works in partnership with various state and non-state actors, facilitating effective collaboration between development policy and other key areas. 

Through its Global Carbon Market (GCM) project, GIZ supports public sector decision-makers and the Private sector in designing and implementing high- integrity market-based instruments as part of their national climate strategies.  https://www.giz.de/en/projects/global-carbon-markets  

About Perspectives Climate Group 

Perspectives Climate Group GmbH (Perspectives) is an independent policy research and advisory group that provides practical solutions to private sector, governments, financial institutions and non-governmental organizations for domestic and international climate policies, international carbon markets and climate finance instruments.   

https://perspectives.cc/ 

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NOVEMBER 20, BELÉM – A new guide to developing high-integrity carbon projects in the Brazilian Amazon has been launched to support quality nature-based solutions that attract higher prices, generating more finance for forest-based communities.

The Best Practice Guide for High-Integrity Carbon Projects in the Brazilian Amazon outlines approaches for ensuring the credibility and sustainability of carbon finance projects in line with the region’s ambitious targets and specific context and needs. 

The guide was developed with the governments of neighboring Amazonian states, Acre and Rondônia, as part of the Voluntary Carbon Markets Integrity Initiative’s Access Strategies Program. Members of the guide’s working group included the Amazon Investor Coalition (AIC), Climate Focus, LACLIMA, and the Governors’ Climate and Forests Task Force (GCF Task Force).

Around 60 per cent of the Amazon rainforest lies within Brazil’s borders and plays a fundamental role in both global climate regulation and Brazil’s economy. Recent figures showed that deforestation fell to its lowest level for 11 years last year, with Rondônia and Acre in the top three states for reductions.

According to the World Bank, an estimated $7 billion a year is needed to conserve the Amazon but only $5.81 billion has been mobilized from 2013 to 2022.

“We see enormous potential for carbon finance projects, including REDD+, to deliver much-needed funding for the protection of our globally important forest and those who depend on it,” said Leonardo Carvalho, Secretary of Environment of Acre.

“But it is imperative that these projects are developed in line with state, federal and internationally recognized standards to ensure they have high integrity. This guide is an important resource for both project developers and investors.”

Acre’s accounting area covers the entire state, measuring 16.4 million hectares, which includes 7.7 million hectares in conservation units within the Amazon biome. As part of its implementation, Acre established legal and technical procedures to integrate private REDD+ projects and avoid double counting.

Rondônia, meanwhile, has a State Register of Emissions Reductions for registering carbon projects with methodologies approved by the Management Board of the State System of Climate Governance and Environmental Services (SGSA).

“By ensuring carbon projects meet rigorous, consistent, and transparent standards, Amazonian states can attract higher prices and ultimately unlock higher levels of finance,” said Diogo Martins Rosa, Director of Climate Governance, State Secretariat for Environmental Development of Rondônia (SEDAM-RO).

“This new guide ensures those that are entering the market for nature-based solutions in the Brazilian Amazon do so with the fullest understanding of our unique ecosystem.”

The guide covers aspects of carbon project development such as who can implement a carbon project in Brazil and under which conditions. It also provides guidance for engaging with the Brazilian Emissions Trading System (SBCE) and resolutions of Brazil’s National Commission for REDD+.

In addition, the guide sets out the importance of land rights for the validity of carbon credits and best practices for ensuring free, prior, and informed consent (FPIC) from Indigenous Peoples and Traditional Communities as well as the fair and equitable distribution of benefits.

Ana Carolina Avzaradel Szklo, Technical Director for Markets and Standards at VCMI, which produced the guide in partnership with AIC, said: “High-integrity carbon finance projects can support Amazon states to meet ambitious targets for conservation and sustain thriving forest-based economies and communities.

“This guide shows the importance of high-integrity approaches that reflect the needs and realities of local Amazonian communities. It sets out the vital role that social safeguards and the centering of traditional communities play in environmental preservation. The key principles laid out in the guide will inform investors and developers of carbon finance projects, and can provide a reference point for other Amazon states and countries. The development of high-quality projects, grounded in local context, will attract the investments that are needed to support the conservation and restoration of nature in the Amazon.”

The State Secretariats of Environment of Acre and Rondônia were consulted throughout the drafting process and endorse the guide. Specific recommendations on facilitating access to climate finance for Amazonian states were received from the Governors’ Climate and Forests Task Force (GCFTF) Secretariat. 

The publication follows an increasing trend of governments providing clear steers to investors and project developers on what best practice looks like in priority sectors where they believe carbon finance can improve climate, nature, and sustainable development outcomes. Earlier this year, for example, the government of Yucatan in Mexico published a best practices guide, and more recently, at the Africa Climate Summit, a regional alliance of seven governments in East Africa published a manual for developing nature-based carbon projects in Eastern Africa. 

Brazil, which is hosting this year’s COP30 climate talks in the Amazonian city of Belém, plays a leading role in carbon markets worldwide. The country accounts for more than a quarter of South America’s total carbon credits and approximately six per cent of the global market.

Brazil’s contribution is especially prominent in nature-based solutions (NbS), generating 12 per cent of all global NbS credits and nearly a quarter of those issued regionally. The majority of NbS credits come from Reducing Emissions from Deforestation and Forest Degradation (REDD+) projects.

“Providing a clear framework for high-integrity carbon finance projects is fundamental for generating increased demand from buyers and in turn, greater levels of investment,” said Ana Beatriz Freitas, Head of Payments for Environmental Services at the Amazon Investor Coalition (AIC).

“This new guide makes clear the expectations of REDD+ projects and other nature-based solutions, allowing investors to have more confidence in the quality of the market.” 

Ends 

About VCMI 

The Voluntary Carbon Markets Integrity Initiative (VCMI) is an international non-profit organization with a mission to enable high-integrity voluntary carbon markets (VCMs) that deliver real and additional benefits to the atmosphere, help protect nature, and accelerate the transition to ambitious, economy-wide climate policies and regulation. 

https://vcmintegrity.org/

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