Leveraging carbon finance for sustainable development

In the past decade, a range of market-based instruments have emerged to address environmental issues, including the use of compliance and voluntary emission offsets in the area of climate change. The Kyoto Protocol, through the Clean Development Mechanism (CDM) and Joint Implementation, has spurred a rapidly expanding, multibillion-dollar international market in the compliance sector. Financial flows from emission offset markets could become a major source of financing for sustainable development. However, UNDP believes that much more needs to be done to direct carbon finance to a higher number of developing countries, as well as to a broader range of activities that can provide sustainable development benefits. UNDP seeks to help leverage the potentially significant benefits of carbon finance for the developing world:

  • by establishing the MDG Carbon Facility, an innovative mechanism for the development and commercialization of emission reduction projects;
  • through its role as a partner agency under the Nairobi Framework, which aims to improve the level of participation of developing countries in the CDM; and,
  • through its capacity development activities, especially in sub-Saharan Africa, which build in-country capacity to engage with, and derive benefits from, the CDM.

MDG Carbon Facility...

is a mechanism for the development and commercialization of emission reduction projects with significant MDG benefits, and aims to transform carbon finance in developing countries. More

The Nairobi Framework...

seeks to help developing countries, especially those in sub-Saharan Africa, to improve their level of participation in the CDM. Multiple agencies, including UNDP, are cooperating under the coordination of the UNFCCC. More

Capacity Development for CDM...

Through the UNDP-UNEP Partnership on Climate Change, UNDP helps establish efficient host-country procedures, canvas carbon finance opportunities and offer project management services. More