Zimbabwe Implements New Carbon Trading Law

Zimbabwe Implements New Carbon Trading Law - Carbon Herald

Zimbabwe has introduced a new law for carbon credit trading. Project proponents will now receive 70% of the revenue, up from the earlier government announcement of 30% for foreign investors and 20% for locals. The remaining 30% will be an Environmental Levy put into the Environment Fund.

This rule will apply for the first 10 years of the project. Afterward, the agreement can be renegotiated based on current conditions, according to Statutory Instrument 150 of 2023: Carbon Credits Trading Regulations. Previously, the Ministry of Environment, Tourism, and Hospitality stated that the Treasury would get 50% of the income, while foreign and local investors would receive 30% and 20% respectively.

Project leaders must deposit their share within 30 days of receiving proceeds, with a chance to request an extension. Failing to do so within the given time could lead to license cancellation by the new licensing authority in the Ministry of Environment.

At least 25% of the project leader’s 70% share will be invested in consultation with local authorities, and the project owners can retain up to 75%. The Environmental Levy distribution will include climate change adaptation and low carbon initiatives (55%), loss and damage relief (5%), local authority levies (10%), administrative costs (15%), and the Treasury (15%).

Relevant: Dubai’s Blue Carbon And Zimbabwe To Develop Carbon Projects

Zimbabwe ranks as the twelfth largest carbon offsets producer globally, and the country generated 4.2 million credits from 30 projects last year. According to reports, the country’s biggest project is partially managed by South Pole and covers 785,000 hectares of forest in northern Kariba. 

This project, spread across several Zimbabwean provinces, is community-based and collaborates with locals under the administration of four Rural District Councils: Binga, Nyaminyami, Hurungwe, and Mbire.

However, the project promoters are being probed for allegedly generating excessive profits by exaggerating the quantity of carbon credits and disregarding the interests of local communities.

There’s also suspicion of some players profiteering by falsely claiming forest conservation, including in areas managed by the Forestry Commission and Zimbabwe Parks and Wildlife Management Authority.

Read more: 2M Russian Carbon Credits Will Not Be Issued In Zimbabwe, States Carbon Trade eXchange

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