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Can carbon markets unlock Africa’s green economy? – EnviroNews
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Africa is at a critical crossroads in its economic and environmental development, with governments under pressure to create jobs, reduce poverty and attract investment while confronting the impacts of climate change.
Across the continent, prolonged droughts, desertification, flooding, land degradation, rising temperatures and biodiversity loss are threatening livelihoods and economic development.
Yet, amid these challenges, carbon markets are emerging as a potential opportunity for Africa’s green economic transition.
Carbon markets put an economic value on activities that reduce or remove greenhouse-gas emissions, allowing verified emission reductions to be converted into tradable carbon credits.
For Africa, where access to climate finance remains a major challenge, experts say carbon markets could provide an additional source of funding for the transition to a greener and more resilient economy.
The African Development Bank (AfDB) estimates that Africa needs about $2.7 trillion by 2030 to implement its climate commitments, leaving the continent with a huge financing gap.
The financing challenge is especially significant because Africa contributes only about three per cent of global greenhouse-gas emissions but remains highly vulnerable to climate change.
Against this backdrop, carbon markets are being considered as one of several mechanisms for mobilising private capital for climate action.
Speaking in an interview, Mr. Francis Opolot, Uganda’s Minister of Water and Environment, said carbon markets could help convert environmental protection into an economic opportunity.
He explained that projects involving forest restoration, clean cooking, renewable energy and improved agricultural practices could generate carbon credits when they achieved measurable emission reductions or removals.
According to him, the credits could subsequently be purchased by governments, businesses or other organisations seeking to meet climate commitments.
Opolot, who cited World Bank findings, said carbon markets could mobilise private capital for projects capable of reducing or removing emissions.
“For Africa, where access to climate finance remains a major challenge, this could be transformative,” he said.
He noted that Africa possessed enormous natural resources capable of supporting carbon-market development, including forests, wetlands, grasslands and agricultural landscapes.
The Congo Basin, he added, was particularly important because of its extensive tropical forests and the ecological services they provide.
“Much of this environmental wealth has remained undervalued in conventional economic calculations,” he said.
A standing forest, for instance, may not generate immediate financial returns comparable to timber, mining or agriculture.
However, forests absorb carbon dioxide, regulate water systems, protect biodiversity and support millions of livelihoods.
Consequently, carbon markets could provide a mechanism for placing part of that environmental value within an economic framework, provided appropriate safeguards are established.
Meanwhile, Mr. Mukhtar Abdulhameed, Chief Executive Officer of Carbon Assets, an NGO, said carbon markets could give financial value to environmental services.
Abdulhameed, a participant in the Climate Beyond Borders Caravan (CBBC), said this would depend on projects being scientifically credible, legally sound and designed to protect community interests.
The CBBC is an initiative of the Planet, People and Peace Foundation, a pan-African youth-led campaign promoting climate action, cross-border cooperation and green economic transformation.
In February 2026, the World Bank announced that six Congo Basin countries; Cameroon, Central African Republic, Democratic Republic of Congo, Equatorial Guinea, Gabon and Republic of Congo, had launched strategic roadmaps for carbon markets and climate finance in the forest sector.
The roadmaps are designed to help the countries mobilise climate finance, strengthen carbon-market institutions and use their forest assets to support climate-resilient growth, sustainable development and green jobs.
Abdulhameed said the development showed that forest conservation could be viewed not only as an environmental responsibility but also as part of a broader economic strategy.
He, however, said the success of carbon markets should not be measured only by the number of credits generated or the amount of money exchanged.
Rather, he said attention should be paid to what happened to communities where carbon projects were located.
“Forest restoration could create employment while improving degraded land.
“Agroforestry can help farmers increase resilience and diversify their income. Clean cookstoves can reduce household air pollution while lowering pressure on forests.
“Solar projects can expand access to electricity while reducing dependence on fossil fuels,” he said.
The United Nations Development Programme (UNDP) has also highlighted carbon-market activities linked to agriculture, forest restoration, clean cooking and solar energy as areas capable of supporting livelihoods and sustainable development.
In Zambia, for example, tree-planting activities have been linked to carbon-credit generation alongside agricultural and livelihood benefits, according to Abdulhameed.
Thus, carbon markets could help shift climate action from being viewed only as a cost to being seen as an investment in jobs, livelihoods and sustainable development.
In her submission, Miss Ether Takow, a Cameroonian participant in the CBBC, said Africa’s young and growing population made employment one of the continent’s most pressing priorities.
She said the green transition could create opportunities in forestry, renewable energy, sustainable agriculture, carbon accounting, environmental monitoring, data management, project development and climate finance.
Takow cited the Africa Carbon Markets Initiative (ACMI), which has projected that African carbon markets could generate up to six billion dollars in revenue and support 30 million jobs annually by 2030, if its ambitions are achieved.
She said the opportunity would only benefit young Africans if governments and investors deliberately developed local skills and expertise.
“Universities, technical institutions and professional organisations therefore have an important role to play in preparing young people for the emerging carbon economy,” she said.
Furthermore, the development of carbon markets is linked to Article 6 of the Paris Agreement, which provides a framework for international cooperation in achieving emissions-reduction targets.
Article 6.2 allows countries to cooperate through internationally transferred mitigation outcomes, while Article 6.4 establishes a UN-supervised mechanism for generating carbon credits under the Paris Agreement.
Takow said these mechanisms could create additional pathways for African countries to access climate finance.
She cited Ghana as one of the countries that had moved early in developing arrangements for implementing Article 6 activities, including projects involving climate-smart agriculture and waste management.
According to her, such developments showed that carbon markets were moving beyond voluntary corporate initiatives towards more structured national and international systems.
Nevertheless, Mrs. Adenike Aluko, Deputy Director, Water and Environmental Sanitation Department, Ilesa North-East Local Government, Osun, said the promise of carbon markets came with significant risks.
She stressed that generating carbon credits was not enough, as the credits must represent genuine, measurable and verifiable emission reductions or removals.
“Concerns about exaggerated emission reductions, double counting, weak monitoring, land rights and inadequate community benefits have affected confidence in some carbon projects,” she said.
Aluko warned that Africa should avoid becoming a source of cheap carbon credits for international companies while communities received little economic benefit or lost control over their land and natural resources.
Instead, she called for carbon markets to be built around transparency, accountability and fairness.
“If African forests become valuable because they store carbon, the people who protect those forests should have a meaningful stake in the resulting revenues,” she said.
She identified clear land-tenure arrangements, transparent contracts, informed community participation and effective benefit-sharing mechanisms as essential safeguards.
Similarly, governments, she said, needed strong regulatory institutions capable of monitoring carbon projects and preventing fraudulent or environmentally harmful activities.
According to her, the need for strong governance was gaining attention in research on carbon-market development.
She cited a 2026 study published in npj Climate Action on carbon-market development in Ethiopia, which examined the importance of regulatory and governance structures as well as the socioeconomic effects of carbon markets.
Furthermore, Mrs. Adeola Awokusibe, a Senior Secondary Science Teacher in Osun, said another major challenge was the credibility of carbon credits.
According to her, a carbon credit that did not represent a genuine emission reduction provided little climate value.
She therefore stressed the importance of accurate Measurement, Reporting and Verification (MRV) systems.
“African countries need stronger technical capacity to measure forests, monitor land-use changes, verify emission reductions and maintain reliable carbon registries.
“Digital technologies, satellite imagery, remote sensing and improved environmental data systems could play an important role,” she said.
Awokusibe also called for stronger independent verification and public transparency to enable investors and communities to determine where credits originated and how revenues were distributed.
She, however, cautioned that carbon markets should complement direct climate action rather than become a substitute for it.
Companies, she said, should not use carbon credits as an excuse to maintain unnecessarily high emissions.
Likewise, governments should not regard carbon markets as a replacement for investment in renewable energy, sustainable transport, climate-resilient agriculture and forest protection.
Awokusibe said the World Bank’s 2026 carbon-pricing report showed that direct carbon-pricing instruments now cover nearly 30 per cent of global greenhouse-gas emissions.
She said the report also showed that carbon-credit issuance increased by eight per cent between 2024 and 2025, although prices declined slightly during 2025.
“These developments suggest that the global carbon economy is becoming more sophisticated; but also more competitive.
“Africa therefore needs to focus on producing high-integrity, high-impact projects, rather than simply increasing the volume of credits,” she said.
According to her, Africa’s carbon economy could encompass renewable energy, clean cooking, sustainable transport, waste management, regenerative agriculture, methane reduction, mangrove restoration, ecosystem conservation and industrial decarbonisation.
Mr. Seun Agboola, Charter President of the Club of the Rotary E-Club of One Nigeria, said Africa’s carbon economy could help shift the continent from a largely extractive economic model.
He said environmental protection, innovation and sustainable production could become significant sources of economic value.
Agboola said governments needed to establish clear laws and regulations, strengthen carbon-market institutions and protect community and land rights.
They also needed to improve MRV systems and ensure transparent mechanisms for sharing carbon-market revenues.
“Most importantly, Africans should not merely be suppliers of carbon credits to a global market.
“They should become owners, developers, investors, professionals and decision-makers within the carbon economy,” he said.
According to him, the ultimate measure of success should go beyond the value of carbon credits traded.
Rather, it should include forests protected, degraded land restored, emissions reduced, communities empowered, young people employed and African economies made more resilient.
Agboola said Africa possessed enormous potential to connect climate action with economic transformation, from the forests of the Congo Basin to farms in East Africa and renewable-energy projects across the continent.
“Carbon markets could help convert some of that potential into finance for sustainable development. But the opportunity comes with a responsibility.
“Africa must avoid a carbon economy built on weak standards, opaque contracts and unequal benefit-sharing.
“Instead, it needs markets grounded in environmental integrity, social justice, transparency and African ownership,” he said.
Africa’s natural assets can become more than symbols of the continent’s environmental wealth if managed wisely.
They can become part of the financial foundation for a green economy that protects nature while creating jobs, attracting investment and improving the lives of communities.
The challenge, therefore, is no longer whether Africa possesses carbon assets.
The real challenge is whether the continent can build the institutions, markets and partnerships needed to ensure that their value works for Africans.
Ultimately, the future of carbon markets on the continent should not be measured simply by how much carbon is sold.
It should be measured by how effectively climate finance helps protect forests, restore degraded land, create jobs, strengthen livelihoods and build a greener and more inclusive African economy.
By Gabriel Agbeja
