At COP29, Article 6 of the Paris Agreement commanded significant attention, as nations grappled with refining mechanisms to operationalise global carbon markets. These markets, designed to facilitate international cooperation on emissions reductions, have immense potential to accelerate climate action.
However, their success depends on addressing critical concerns about transparency, equity, and environmental integrity. For Africa, the stakes are especially high: the continent faces both unprecedented opportunities to drive sustainable development and grave risks of exploitation.
Understanding Article 6
Understanding Article 6 requires delving into its dual mechanisms designed to facilitate international cooperation in reducing emissions and creating global carbon markets. At its core, Article 6 provides a framework for countries to engage in voluntary collaboration to meet their climate goals, but its implementation poses distinct opportunities and challenges. The first mechanism, Article 6.2, enables bilateral agreements through the trade of Internationally Transferred Mitigation Outcomes (ITMOs).
This flexibility allows countries to meet national emissions targets by recognising carbon credits derived from domestic systems or linked markets. While the mechanism offers promise, it relies heavily on transparency and civil society oversight instead of direct supervision by the UN. This reliance has raised concerns about accountability and the quality of traded credits, as inconsistencies in standards and enforcement could lead to the proliferation of dubious transactions.
The second mechanism, Article 6.4, establishes a centralized system supervised by the UN to generate and trade carbon credits. Unlike the bilateral nature of Article 6.2, this standardised approach prioritises environmental integrity and sustainable development. It aims to address many criticisms directed at the Clean Development Mechanism (CDM), which was plagued by concerns over weak additionality criteria and social inequities. However, the decision to transition discredited CDM credits into the Paris Agreement Crediting Mechanism (PACM) threatens to erode the credibility of the new system, as these credits often fail to represent genuine emissions reductions.
Challenges
Despite these mechanisms aimed at unlocking finance, incentivise emissions reductions, and enabling countries to meet their climate commitments, their operationalisation is fraught with challenges that threaten their effectiveness and credibility. A major hurdle is the lack of uniform standards for measuring, reporting, and verifying emissions reductions. Different countries and entities adopt varying methodologies, which can lead to discrepancies in the quality and credibility of carbon credits. This inconsistency undermines trust in the system and raises concerns about whether these credits represent genuine climate benefits. Without standardized protocols, the risk of double counting – where the same emissions reduction is claimed by multiple parties – further complicates the integrity of carbon markets.
Effective governance is essential to ensure transparency, accountability, and fairness in carbon markets, but the current frameworks often lack the institutional capacity or political will to enforce these principles. For example, Article 6.2 relies heavily on bilateral agreements, where the absence of centralised oversight creates opportunities for manipulation. Countries with weaker regulatory systems may struggle to implement or monitor these agreements, potentially allowing low-quality or fraudulent credits to enter the market.
Their success hinges on addressing underlying governance issues including issues of authorisation, permanence and additionality. These issues will ensure that the framework upholds its environmental and social promises. But with weak governance gap instead of upholding social promises will rather erode confidence in the system and may deter meaningful participation.
Moreso as the presence of loopholes in both Article 6.2 and 6.4 mechanisms presents significant risks of exploitation. For instance, the transition of outdated and often-questionable credits from the Clean Development Mechanism (CDM) to the Article 6.4 framework has raised alarms about the credibility of the new system. These legacy credits, which may no longer represent real or additional emissions reductions, threaten to dilute the environmental integrity of carbon markets.
Furthermore, the potential for speculative trading and the prioritization of profit over climate impact by private actors could skew the markets away from their intended purpose. Weak enforcement of benefit-sharing provisions also risks marginalising vulnerable communities, particularly in regions like Africa, where land-use projects could displace Indigenous Peoples or smallholder farmers without adequate compensation or consultation.
Weak Governance and Accountability Gaps
At the heart of the issue is the governance vacuum surrounding Article 6. While the Paris Agreement emphasizes transparency and environmental integrity, COP29 failed to establish clear accountability structures to enforce these principles. For instance, countries engaging in ITMO trading under Article 6.2 are required to submit information about their transactions, but delays in reporting and lack of detail about credit quality leave room for abuse. Critics argue that the reliance on “naming and shaming” as a primary enforcement tool is insufficient to deter bad actors, particularly in the absence of tangible penalties for non-compliance.
Moreover, the supervisory body for Article 6.4 has yet to develop comprehensive methodologies for high-integrity projects, particularly those involving emission removals through forestry or carbon capture. The rules currently allow for speculative credits, further eroding trust in the system and risking long-term damage to the global climate regime.
The governance vacuum surrounding Article 6 is particularly detrimental to Africa. COP29’s reliance on bilateral agreements (Article 6.2) without robust oversight undermines trust. unfortunately the COP29 has relegated this roel to COP30. Weak reporting standards and the absence of enforcement tools make it easy for low-quality or fraudulent credits to flood the market. Similarly, transitioning dubious Clean Development Mechanism (CDM) credits into the new framework (Article 6.4) erodes the credibility of the system, allowing for speculative trading that prioritizes profits over genuine emissions reductions.
For African nations, this lack of accountability is disastrous. Countries with limited regulatory capacity face significant challenges in monitoring transactions or ensuring environmental and social integrity. The result is a system skewed toward wealthier, more powerful actors, sidelining African interests and diluting the continent’s capacity to leverage carbon markets for sustainable development.
The Stakes for Africa
For Africa, the stakes could not be higher. The continent’s vast natural resources, including forests and grasslands, make it a critical player in global carbon markets. Yet, the weak safeguards established at COP29 leave African nations vulnerable to exploitation. Land-use projects, a significant focus of carbon credit generation in Africa, often result in displacement of Indigenous Peoples and local communities, who see little to no benefit from the profits generated.
This mirrors historical patterns of resource exploitation and perpetuates inequalities rather than addressing them. Furthermore, the lack of capacity to influence negotiations or enforce rigorous standards means that African nations risk being marginalised in a system that prioritises profit over equity and sustainability. The decisions at COP29 failed to address these asymmetries, leaving African countries exposed to the detrimental impacts of unchecked carbon trading.
COP29: Progress and Limitations
Negotiations at COP29 delivered mixed results. Positive developments included a recognition of Indigenous Peoples’ role in carbon market governance and progress in defining methodologies for emissions removals. These steps signal a growing acknowledgment of the need for inclusivity and environmental integrity in Article 6 implementation. Yet, significant shortcomings remain. The decision to allow CDM credits to transition into the new system without rigorous reassessment undermines trust in the framework’s effectiveness.
Additionally, the lack of robust oversight for ITMO transactions and delays in disclosure requirements create transparency gaps, enabling potential exploitation. Again, issues of authorisation and permeance is till loosely cast enabling different interpretations. Mores, its interpretation has been outsourced to another body there by outsourcing responsibility. These weaknesses threaten to erode confidence in the integrity of carbon markets and reduce their impact on global emissions reductions.
Reclaiming Article 6 from Carbon Cowboy
To ensure Article 6 mechanisms achieve their potential, urgent reforms are needed. African nations must play a proactive role in advocating for stronger governance, enhanced transparency, and equitable benefit-sharing. Real-time disclosure of ITMO trades, stringent penalties for non-compliance, and a commitment to high-quality credits are essential to build trust in the system.
Capacity building for African governments and institutions is also crucial. Technical and financial support will enable better participation in carbon markets, allowing African nations to negotiate effectively and implement projects that align with their development priorities. Developing domestic carbon markets can further reduce reliance on international systems and retain financial benefits within the continent.
A Call to Action
COP29 has highlighted both the potential and the peril of Article 6. As the world looks ahead to COP30 in Belém, Brazil, the need for decisive action to reclaim this critical framework has never been more urgent. By addressing its shortcomings, the international community can transform Article 6 into a powerful tool for climate ambition, sustainable development, and global equity. The alternative is a world dominated by Carbon Cowboys which is a future the world cannot afford.
By Dr. Sadiq Austine Igomu Okoh
