CARBON CREDITS FOR SUB-SAHARAN AFRICA - lumes

markets, it is considered to be able to provide better opportunities to promotesustainable development in the region (Harris, 2007).Regardless of Africa’s prospects to gain outside investment for sustainabledevelopment through the Kyoto mechanisms, the continent has thus far received anextremely low share of CDM investment with 102 projects registered in a pipeline outof total 4733 (UNEP Risø Centre, 2009). More than a half of projects are in SouthAfrica (UNEP Risø Centre, 2009). With only 2% of total number of CDM projectsAfrican continent has not benefited from this mechanism notwithstanding its potentialin biomass, renewable energy and forestry. Several barriers, including lack ofavailable finance, lack of industrial-based economies, high dependence on agricultureand forestry, lack of strong institutional framework, high risk level for investments,lack of expertise, lack of political will, restrictions on agro-forestry projects underCDM, among other factors appear to impede participation in market-basedmechanisms (Lesolle, 2008; WB, 2008). While three quarters of Sub-Saharan AfricaGHG emissions come from land use and land use change (Collier, 2008; WRI, 2008)the large classes of LULUCF assets attractive from the perspective of sustainabledevelopment are constantly excluded from the regulatory markets (WB, 2008). Interms of generated volumes of projects, if compared in relation to Kyoto-basedprojects, Africa is, however, better positioned in the voluntary market (EcosystemMarketplace, 2008). Although here again it lags behind other continents. VCM-basedprojects provide additional non-carbon benefits and have potentially more scope toinvest into small-scale community-oriented land use and agro-forestry projects and,thus, have potential to fill in the gaps the compliance market does not address. Thisemerging carbon market offers a platform for GHG emission reductions for theprivate sector actors aiming to invest in ‘social good’ projects. Sub-Saharan Africahas a lot of opportunities to benefit from certain voluntary-based projects that canaddress the issue of engaging underrepresented developing countries into the globalcarbon market, providing stream of finance, and contributing to overall sustainabledevelopment objective in the region.Indeed, there is a need to assist in adaptation of development pathways thatwill confront major causes of GHG emissions and will utilize the opportunitiesAfrican continent offers in consistency with regional and global sustainability goals(IPCC, 2007; Canadell et al., 2008). Thus, more robust understanding of the complexcontext of carbon development in the African regions is required if positivesustainable development benefits are expected to result from carbon finance.Moreover, much more has to be understood about the role of carbon markets inaddressing the needs of developing countries, and in particular how the voluntarybasedprojects can contribute to channeling carbon investment to Sub-Saharan Africaand the sustainable development potential they may hold.3