Govt makes strides in decree on carbon credits

The government is drafting a decree on carbon credits generated by Lao forests for sale on the international market.
The Department of Climate Change Management, Ministry of Natural Resources and Environment, in cooperation with development partners recently held talks on the details of the decree, including the processes involved in the buying and selling of carbon credits.

A protected forest area which generates carbon credits.

Discussions centred on calculating and certifying greenhouse gas emission reductions including benefit sharing, income tax, and fees and service charges involved in the purchase and sale of carbon credits.
Officials from the Department of Climate Change Management said the decree will promote investment in greenhouse gas reduction and enable the purchase and sale of carbon credits to be managed through a centralised system.
The decree will also ensure the Lao carbon market is clearly defined and the degree will be an efficient tool for the government in regulating and selling carbon credits in the Lao and international markets.
The Ministry of Natural Resources and Environment will flesh out the decree so that it covers all aspects of the carbon trade and submit it for comments to local government agencies before forwarding the final draft for consideration at the government meeting in June.
The World Bank has committed a budget of about US$42 million under the Forest Carbon Partnership Facility to purchase carbon credits from Laos from 2020 to 2025.
The Bank’s initiative aims to reduce carbon emissions released into the atmosphere, one of the main causes of global warming and extreme weather patterns around the world.
Developing, developed nations and major corporates have agreed to buy carbon credits from countries as part of their social business responsibilities.
Lao forestry officials say the government is strongly committed to protecting forests and hopes to earn income from sale of carbon credits, but that challenges in protecting natural habitats remain unresolved.
One of the key challenges is poverty among communities living in and around designated forest areas, which makes it difficult for the authorities to enforce the law concerning forest protection.
In addition, the capacity of authorities to protect forests must be strengthened so they can effectively protect large areas, which cover about 35 percent of the country’s total land area.
In order to protect forest areas, forestry officials say the government will use money earned from the sale of carbon credits as well as funds sourced from development partners to reduce poverty in designated areas.

By Times Reporters
 (Latest Update April 3, 2024)