End of last year before COP, Tanzania enacted a regulation that provided for the rules of carbon trading in Tanzania. The regulation controls and manages the carbon trading in Tanzania and outlines the duties, rights and obligations of the stakeholders in this trade namely the ministry responsible for environment, the Director of Environment, the National Carbon Projects Assessment Technical Committee, other sector ministries, the Ministry responsible for local government authorities, the Regional Secretariat, local government authorities, the owner of the property involved in the carbon trading project, the owner of the carbon trading project or programmes, the National Environment Management Council, Village Governmen, private sector players, development partners and civil society organisations.
The regulation provides for a lengthy procedure of registering the carbon trading project in question and a notable requirement is that the owner of the project must have expertise in carbon trading, capacity to invest in carbon trading.
So, what does this mean for Tanzania?
If we examine the global statistics when it comes to carbon emissions, Sub- Sahara Africa is responsible for emitting only 2% of the carbon gases and of the 2%, 1.4% is distributed between South Africa and Egypt and the rest 0.6% is distributed between the 52 countries in Africa. Tanzania, along with several other less industrialised countries in Africa, record a per person annual carbon emission of 1.2 tonnes per year and this is compared to the UK’s 10.7 tonnes per person per year, and America’s 23.5. This means that a country like Tanzania has ‘surplus’ carbon to sell to the industrialised world.
I believe that because of such regulations, investment for green projects will be attracted in Tanzania. As recent as last week Blue Carbon, the UAE-based entity and the Government of Tanzania, through Tanzanian Forest Services Agency under the Ministry of Natural Resources and Tourism, signed a Memorandum of Understanding (MoU) marking the start of a collaboration aimed at promoting sustainable forest management practices and reducing greenhouse gas emissions. The main aim of the partnership between the UAE and Tanzania is to develop new carbon offset projects to support decarbonization targets.
Indeed, Tanzania has extensive forests as natural resources where a lot of the carbon remains locked up. It is believed that the carbon trade could be worth up to USD 500 million per year to the country if projects are well executed.
In addition to Tanzania’s pro-community and pro-conservation rules when it comes to forestry, the carbon trading regulations continues to put the community at the forefront of the primary beneficiaries of such projects.
Firstly, the regulation also provides for obligatory Corporate Social Responsibility that the project must fulfil in the area of investment.
This can be seen through the cost sharing provisions provided under regulation 34, for example, the Managing Authority also known as the owner of the property involved in the carbon trading project shall be entitled to sixty one percent of the gross revenues accrued from the sale of Certified Emission Reduction. Other cost sharing provisions ensure that the community is gaining revenue as well as village council. Therefore, if the owner of the property is a village or a group of people in a community, we can see that they stand to gain a lot from such projects.
However, there is a possibility that project owners may negotiate resettlement of communities elsewhere or acquire the land therefore side lining the community. An example of this was in Uganda where the Norwegian forestry and carbon credit company, Green Resources, forcibly evicted villagers around their plantation in Kachung, Uganda. The establishment of the plantation on land previously used by subsistence farmers precipitated an on-going food security crisis that has not been addressed by the company, its financiers, nor the Ugandan government. We hope that such incidences do not happen in Tanzania, however, it will be remained to see how the government can ensure that investors do actually collaborate with already existing communities in a said area.
While there are those that are sceptical about carbon trading for reasons namely that it is considered as a license for developed nations to continue polluting but feel better about it with “off – setting” mechanism provided by carbon trading. There are others that feel that this is a new way for the western countries to take advantage of the abundant resources in Africa, namely carbon, but that given that the carbon prices are regulated in these same developed nations, it will be another story like the one of raw materials being priced poorly in Africa but benefiting immensely the west. I think that as this regulation will be tested, we will remain observers and see whether carbon trading can make the difference that it sells itself to make in communities lives and developing nations’ budgets.