The Government of the Lao PDR, the Government of Australia, and the Global Green Growth Institute (GGGI) have formed a partnership to support carbon market development in the Lao PDR. A signing ceremony was held in Vientiane on Tuesday, 6 June, 2023, to mark the official commencement of the “Program for Open and Sustainable Carbon Markets in the Lao PDR.”
This program, supported by the Department of Foreign Affairs and Trade, through the Australian Embassy, Vientiane, with an investment of AUD 2.6 million over three years, highlights the shared commitment of the Government of the Lao PDR and the Government of Australia in driving sustainable development and addressing climate change through market mechanisms, in alignment with Article 6 of the Paris Agreement. The program will be led and coordinated by the Ministry of Natural Resources and Environment.
The program aims to establish a coordinated multi-sectoral policy framework for carbon markets in the country. This framework will strengthen the domestic carbon market while also enabling sustainable participation in international carbon markets. By enhancing policy, institutions, systems and infrastructure for carbon market management, the Lao PDR will be better equipped to actively engage in the global carbon market.
“Australia is proud to be supporting the Government of the Lao PDR in this important sector,” said Mr Dan Heldon, Deputy Ambassador, Australian Embassy. “The program further demonstrates the strengthening of relations between our countries, as outlined and confirmed by our Ministers for Foreign Affairs last month”, he said.
A key aspect of the program is the enhancement of the Lao PDR’s pipeline of carbon sequestration and emissions reduction projects. By bolstering these projects, the partnership will create avenues for increased private sector and community involvement in carbon opportunities.
“Currently, there is some uncertainty around how firms, project developers and communities can access the carbon market,” said Mr Rowan Fraser, Country Representative, GGGI. “Under the leadership of the Ministry of Natural Resources and Environment, the program will bring a lot more clarity and certainty in terms of the regulatory and institutional regime.”
As a result of the “Program for Open and Sustainable Carbon Markets,” the Lao PDR will be better positioned to engage and participate in international carbon transactions under Article 6 of the Paris Agreement. This will help to secure vital carbon finance, advance green and low-carbon investment, stimulate climate ambition and action, and generate socio-economic co-benefits for the country.
