COP29 Agreement Enhances Investment Opportunities for Low-Income Countries, World Bank Reports
The COP29 agreement on international carbon markets, reached in Azerbaijan, is expected to boost investment in low-income countries by clarifying cross-border trading rules for carbon credits. The World Bank reported that around $14 billion was mobilized for carbon credit projects in 2024, primarily for nature-based solutions, and set a new annual funding target of $300 billion. Effective implementation will require capacity-building focused on institutional frameworks and market infrastructure.
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An agreement on international carbon markets reached at COP29 in Azerbaijan in November 2024 could increase investment flows to low-income countries. The World Bank noted that carbon credit markets can channel private investment into projects that reduce emissions, such as forest planting and eco-friendly technologies.
Approximately $14 billion was mobilized for new carbon credit projects globally from Q1 to Q3 2024, mainly for nature-based solutions. The COP29 agreement clarifies cross-border trading rules for carbon credits under the Paris Agreement.
Key decisions included setting a new annual funding target of $300 billion and operationalizing a Loss and Damage Fund. Capacity-building will be essential for practical implementation of the agreement, focusing on institutional frameworks and market infrastructure.
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