The Economist writes on how carbon credits could boost Africa’s economy.
- The demand for voluntary carbon credits is heating up in Africa which is yielding economic and environmental benefits for the continent.
- For companies like KOKO, a Kenyan startup that creates bioethanol stoves, carbon credits are allowing the firm to reinvest capital to grow their business and reduce costs for consumers.
- The growth of KOKO is saving lives as people have been able to transition away from the use of charcoal and dung to meet their heating needs.
- Still, hurdles remain with carbon markets, including monitoring and verification.
“KOKO hints at why there is excitement about carbon markets. The African Carbon Markets Initiative (ACMI), a UN-backed consortium, reckons that Africa uses just 2% of its annual carbon-credit potential; it aims for Africa to sell $100bn worth of credits a year by 2050. Even a fraction of that would be a boon for a continent where annual foreign direct investment has never surpassed $80bn. William Ruto, Kenya’s president, calls carbon credits an “unparalleled economic gold mine” and his country’s “next significant export”. Yet, as is often the case with Africa and its natural resources, things could go wrong.”
Read the full article here.