The Centre for Trade Policy and Development (CTPD) , a think tank of Zambia urged the government to extensively engage with relevant stakeholders in the process of developing legislation on the carbon market.
The Centre for Trade Policy and Development (CTPD) trade policy and development think tank of Zambia urged the government to extensively engage with relevant stakeholders in the process of developing legislation on the carbon market. This comes after the signing of the 450 million Euros Forest partnership between the European Union (EU) and Zambia, as well as four other countries, at the COP27 to the Paris agreement in Sharm el-Sheikh (Egypt).
The Zambian Minister of Finance in his 2023 national budget speech further stated that the government developed guidelines and listing rules for green bond trading and is in the process of developing legislation to regulate the carbon market in line with the Kyoto Protocol on climate change. The signed forest partnership will not only sustain forests, biodiversity, and livelihoods at the local level but also serve as another means of resource mobilization in the carbon markets. Carbon trading and green bonds have been identified as among the key sources of resource mobilization for developing countries during the climate crisis, and Zambia is no exception.
The growth and acceleration of the carbon markets over the years, offer a good opportunity for countries adversely affected by climate change, especially developing countries to raise the much-needed resources for building resilience, and tackling inequality and poverty at large. The State and Trends of Carbon Pricing Report for 2022 by the World Bank state that global carbon trade revenue in 2021 increased by almost 60% from 2020 levels to around $84 billion, providing an important source of funds to help support a sustainable economic recovery, finance broader fiscal reforms, or invest in communities as part of the low-carbon transition future.
However, the effects of climate change have adversely affected the socio-economic strides attained this far, and have amplified the already existing challenges, locking the poor and vulnerable communities into more poverty. This has forced communities to overexploit natural resources through acts such as cutting trees for charcoal production and firewood to sustain their well-being resulting in deforestation, further increasing their vulnerability to climate change aberrations.
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Zambia is the most impacted African country by charcoal production, and with the highest deforestation rates in the world with a yearly loss of about 300,000 hectares of forested land. Thus, while efforts to develop legislation to regulate the carbon market for resource mobilization are commendable, this should not be at the expense of the poor and vulnerable communities that depend on natural resources more so forest products for sustaining their livelihoods.
