Carbon pricing approaches in Eastern and Southern Africa

Increasing international industrial greenhouse gas (GHG) emissions and the degradation of carbon sinks have, in recent years, contributed to scientific certainty around climate change, particularly mitigation, as a global concern. Numerous resources have shown that developing and least
developed countries (LDCs) are the most vulnerable to the anticipated impacts of climate change, even though such countries typically have small to immaterial sources of GHG emissions.

Subsequently, with pollution and climate change being a classic problem of environmental externality, there is a substantial need for governments to take corrective action in this regard.
Given the seriousness of these problems, it is critical that governments address the drivers of anthropogenic climate change, including through the implementation of policy instruments that exploit, in a least-cost manner, various behavioural and economic responses that can contribute to
the alleviation of such impacts. Carbon Pricing is one such policy instrument that has been used, in various jurisdictions, to help mitigate GHG emissions and support adaptation efforts.

The development and implementation of Carbon Pricing provides governments with an option to address the economic externalities associated with GHG emissions and, incidentally, the pollution
and environmental degradation cause by various sectoral activities. However, to date there has been only limited use of Carbon Pricing on the African continent. This study aims to explore possibilities to implement Carbon Pricing, within the Project Countries; and, encompasse technical and legal analysis and observation which suggests the currently limited use, or total absence, of Carbon Pricing in such countries. The project team aimed to identify the hurdles associated with the implementation of the Carbon Pricing and possibilities to overcome such hurdles, in order to implement Carbon Pricing on both national and regional levels, by the Project Countries.