Carbon Markets and Green Economy Transition
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The Chakwera administration has positioned carbon markets as a strategic pillar in Malawi’s transition to a green economy. In June 2023, President Chakwera launched the Malawi Carbon Markets Initiative (MCMI), aiming to monetize the country’s vast natural carbon sinks—including over one million hectares of forest reserves and conservation areas—to generate sustainable revenue and climate resilience.
The initiative is projected to yield up to 19.9 million metric tons of carbon credits annually, valued at approximately $600 million (about K1.05 trillion). Initial efforts have already generated 1.5 million carbon credits, with 75,000 sold for K150 million.
Since 2023, Malawi has so far generated K150 million through carbon trading.
Problems to be solved
Underutilization of Malawi’s carbon credit potential, with limited sales to date
Lack of a centralized regulatory framework for carbon trading, leading to fragmented project oversight
Insufficient benefit-sharing mechanisms for local communities involved in carbon offset projects
Opportunities to unlock
Establishment of a dedicated Carbon Market Office and a national framework for international carbon market engagement, including project approval processes and monitoring standards
Authorization of private firms, such as Hestian Innovations, to auction carbon credits internationally, enhancing foreign exchange earnings
Partnerships with initiatives like the African Carbon Markets Initiative (ACMI) and REDD+ to scale up carbon credit production to 5 million credits annually, potentially supporting over 250,000 jobs