Will carbon markets help Africa or is the whole thing a myth?

Most of the smallholder farmers who are being enrolled in carbon credit programs already have limited access to financial services and digital technology, so they have a difficult time understanding how their contributions result in carbon credits and ultimately, payment.

In addition to transparency issues, many smallholder farmers do not understand how the revenues produced from carbon credits are being divided between project developers, brokers, and certification bodies.

Even though carbon credits may be sold for significant amounts on international markets, farmers typically receive very little of that revenue compared to project developers, brokers, and certification bodies, who each take a share of the revenue prior to any labour payments.

Despite these concerns, interest in African carbon projects is rising. Governments and international bodies believe that carbon markets hold much promise for channeling climate finance into rural Africa. Africa is said to have 60% of the world’s available land for farming and is considered to have huge potential for nature-based climate solutions. As such, Africa is considered a frontier for carbon credit production.

For the farmer, there is more at stake than just receiving money. There is the potential for gaining more from training on sustainable farming methods. This could mean more resilient crops and less dependence on costly chemicals – helping to mitigate food security.

In terms of contracts, farmers require more honesty with greater visibility of carbon pricing and larger shares of revenue generated from farming their land, according to experts. To keep rural communities in charge of how their carbon resources are used, additional local cooperatives or community-led projects could play an increased role.

While carbon markets are not necessarily a magic solution to Africa’s agricultural problems, if they are designed to be fair, then they provide farmers with means to adjust to climate change while allowing them to participate in a global climate marketplace that has ignored them for many years.

The ultimate outcome remains to be seen, as there is a question of whether or not these systems focus on those working the land versus simply creating a new marketplace and allowing most of the profits to go to others.

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