Egypt has taken a significant step towards combating climate change with the launch of Africa’s first voluntary carbon market.
The initiative, hailed by Environment Minister Yasmine Fouad, is seen as a crucial step in meeting the country’s climate commitments.
The market, developed over the past two years, will allow businesses to buy and sell carbon credits, rewarding those that reduce greenhouse gas emissions. It is hoped that this will stimulate investment in clean energy projects and sustainable practices.
“This is a pivotal moment for Egypt and Africa,” said Minister Fouad. “By creating this market, we are not only taking action on climate change but also opening up new economic opportunities.”
The government has been working to create a conducive environment for carbon trading, including amending the Capital Market Law to recognise carbon emission reduction certificates as financial instruments.
The Financial Regulatory Authority has also established a regulatory framework for the market.
Egypt aims to position itself as a leader in sustainable economic growth and is using the launch of the carbon market as a springboard for negotiations on climate finance at the upcoming COP29 climate summit, to be held in Baku, Azerbaijan in November.
The country is seeking to secure fair financing tools for developing nations, including carbon markets.
While Africa contributes less than 4% of global carbon emissions, the continent is disproportionately affected by climate change.
By pioneering a carbon market, Egypt hopes to inspire other African countries to follow suit and collectively address the climate crisis.
The market is expected to attract both domestic and international investors, providing a much-needed boost to the country’s green economy.
