High Potential for CDM Markets in Africa

The Clean Development Mechanism (CDM) program, developed under the Kyoto Protocol, is a method of combating climate change by encouraging sustainable development through market incentives. It is essentially a compromise allowing industrialized countries needing to meet Kyoto standards to invest in projects in developing countries, in order to offset their own emissions. CDMs allow industrialized nations to reduce emissions in a more cost-effective way, as projects in the developing world tend to be less expensive.

This approach is controversial, with some critics believing that it can be considered a “cop-out” to instituting real change. Whether this is true or not, CDMs have the potential to largely benefit sustainable development, if the funds are administered and distributed intelligently and efficiently.

Physicist Robert Van Buskirk, from the Lawrence Livermore National Laboratory, is an expert in developing solar power and ovens in rural African villages. He proposes the Super CDM idea, which uses the idea of markets to engineer combined solutions in climate change, poverty, and health. Van Buskirk proposes that the funds that are making their way into NGOs, government and other organizations administering CDM projects be used in a more efficient manner by creating self-sustaining markets that will outlast the terms of the initial project. These markets would function like carbon markets, but encompass environment, poverty, and heath problems together. For example a village working on developing clean water would be offered incentives from the market to develop the most sustainable model.

The premise behind this is that when the local people promote the project themselves, the outcome tends to be more successful and more durable. The developers of the market mechanism should look at ways to incorporate poverty alleviation and health, as well as greenhouse gas reductions. The market should function to economically develop the area, working to maintain a vibrant and thriving environment and social network.

A mangrove-planting project in Senegal, started by the non-profit Oceanium, has been highly successful due to its combination of economic, social and environmental benefits. The mangroves provide a vital ecosystem for the Senegalese coast. The mangroves have been deforested severely in Senegal due to human encroachment, resulting in a tremendous loss of habitat. The villages surrounding the mangrove habitat rely heavily on the ecosystem for their fishing livelihoods, thus the Oceanium project initiated a village-run project to replant the mangroves. The project was initially successful, because the people had an economic interest in protecting the habitat. Some of the increased revenue from fishing stocks increase then goes to re-planting more mangroves. Thus, the cycle continues on a local-run level.

Van Buskirk has spent most of his working career promoting new technologies in solar power and solar ovens in rural West Africa. He has come to realize that the best and most sustainable solutions come from the bottom-up, and not from an imposing outside entity. This is where he became convinced of the power of localized markets to encourage sustainable development. The funds for these markets can come from outside entities like foundations, or from CDM offsets. Buskirk acknowledges that to ensure a market and project’s success, however, rigorous evaluation must be applied, to ensure that funding is well allocated. There is already simply too much money that is wasted on seemingly altruistic environmental and humanitarian projects.

Van Buskirk stresses that money is saved, and the project is vastly more successful, if the local people administer and manage the project. Outside help is about 100 times more expensive to employ than the local people, in places like rural Africa. From Van Buskirk’s personal experience a project is only successful if at least 90 percent of the work is delegated to the local community. This is why it is important to figure out incentives to encourage local involvement. If local markets were developed where needed, to fund projects promoting clean water or lower infant mortality rates, the village invests in these projects independently for their own economic livelihood and future.

Local skills and labor are crucial for sustainable development. The missing piece in most underdeveloped rural regions is the funding for these local projects, a problem which could be solved by the intelligent application of localized CDM markets.