Unity key to successful VCM in Africa: paper
Quantum Commodity Intelligence – African countries should take a unified approach to the development of voluntary carbon markets (VCMs) in order to help overcome hurdles, such as governance complexities and integrity concerns, and unlock the potential that emissions trading offers the continent, according to a new paper by a Morocco-based think tank.
The Policy Center for the New South said in the 'Voluntary Carbon Markets in Africa: A Deep Dive Into Opportunities And Challenges' paper that VCMs in Africa offer a promising solution in the pursuit of climate action and sustainable development on the continent.
"However, they come with a set of multifaceted challenges that necessitate astute navigation," it said.
The potential lies in the prospects of job creation, electrification, meeting objectives of national climate goals under the Paris Agreement, attracting investments, and fostering climate action acceptability, the paper said.
"Africa's abundant natural resources and renewable energy capacity position it as a pivotal player in the global carbon offset market," it added.
"Yet, the path forward is fraught with hurdles. Governance complexities, integrity concerns, carbon colonialism, and the potential for geopolitical tensions require deft handling," the think tank warned.
"To turn these opportunities into reality, a unified approach would be desirable. Harmonisation of VCM strategies among African nations, bolstered by well-defined governance frameworks and standardized methodologies could help move this agenda in that unified approach," the Policy Center argued.
Currently, the approach in Africa "lacks unity, with actions taken at the national or subregional level rather than creating a unified common market", it said.
The paper also raised the issue of language.
"Countries and companies sharing the same language are more inclined to collaborate on large-scale projects, which could explain the clustering of specific countries around VCMs," the think tank said.
It added: "Divergences in interests and geopolitical stances between African countries and between these countries and international donors could also limit their participation in VCMs.
"These geopolitical issues may hinder regional cooperation and the unified and effective implementation of these mechanisms across the African continent."
The paper also said that setting up more "carbon mitigation instruments could help incentivize private sector involvement and investment" in VCM projects.
"Moreover, building local expertise and knowledge in broad carbon markets and other mitigation strategies is essential for efficient execution and management of VCM initiatives," it added.
"The path ahead is intricate, but through a concerted and unified approach, African nations can unlock the transformative potential of VCMs, thereby securing a brighter and more sustainable future for the continent and beyond," the think tank concluded.