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 Agriculture, forestry, energy, and waste management will all be pivotal to creating carbon credits which Namibia will use to build infrastructure that reduces the country's emissions and increases its climate resilience, according to a report in The Namibian.

The Namibia-based news outlet, reports that these sectors will be pivotal in the country's carbon trading endeavours.

"The carbon credits can be purchased from entities that remove or reduce greenhouse gas emissions," the news outlet reported. 

A 2023 World Bank report reveals that, by 2030, 85% of carbon credits will be derived from nature-based sources.

Namibia's  Promotion of Carbon Markets program, launched in August 2022 is a collaborative effort between the Ministry of Environment, Forestry and Tourism and the UN Development Program. It sets the stage for Namibia to become a leading regional implementer of a set of carbon market mechanisms known as the Emissions Trading System (ETS).

Last week, the Japanese government donated US$1.275 million to support the program,  part of Japan's US$42 million commitment to the UN's Support for Transition Efforts to Decarbonization program, which supports 23 countries.

The emphasis on agriculture and forestry as key sectors in carbon credits trading will direct decarbonization funds to the grassroots level, according to the report.

Agriculture and forestry employ a significant proportion of the continent's population. The UN Food and Agriculture Organization estimates that 24% of African land is dedicated to agricultural practices, while forested areas encompass approximately 22.7% of African land.

While previous carbon credits trading programs focused primarily on forests, including farming as an alternative decarbonization strategy holds vast potential. 

Experts suggest that farming, particularly through initiatives like regenerative agriculture, can enhance productivity and boost incomes for over 600 million African smallholder farmers. 

"Carbon credits trading through practices such as agroforestry can not only decarbonize the world but also uplift the incomes of African smallholder farmers," explained Tatika Catipay, Chief Operating Officer of Africa-focused agri-fintech company Degas Limited.

The World Agroforestry Organization highlights the potential of integrating agricultural practices with forestry to drive carbon sequestration. 

A study in the West African Sahel, published in the Climatic Change journal, found that integrating forests into agriculture (agroforestry) could enable Sahelian parklands to sequester over 2 billion additional tonnes of carbon dioxide.

In addition to agriculture and forestry, waste management and energy feature prominently in Namibia's carbon credits trading program. 

Encouragingly, more stakeholders, including the private sector and governments globally, are demonstrating increased commitments to utilizing carbon credits trading to achieve net-zero ambitions, despite past figures falling short and accusations that carbon credits have been used to "greenwash" harmful activities.

According to UNECA estimates, only around 11% of voluntary carbon market credits were utilized from 2016 to 2021 in Africa. However, the 2023 update from the Climate Action Platform Africa shows that the value of the voluntary and compliance market more than doubled between 2020 and 2022.

Lucy Nyoike, from the Global Energy Alliance for People and Planet, highlights the immense potential to leverage voluntary carbon markets in Africa for enhanced climate financing. 

"All that is needed is to ensure there is high integrity in the market and fair revenue sharing to benefit local communities," she noted.

This relatively nascent decarbonization model could form the basis of future alternatives to achieve net zero ambitions by 2030.

Research firm McKinsey estimates the demand for carbon credits will increase by a factor of 15 or more by 2030. This could also accelerate further by a factor of up to 100 by 2050. 

Consequently, the carbon credits market could be valued at over $50 billion by 2030, presenting significant economic prospects, especially for local communities, according to McKinsey.

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