VIENTIANE, Jan 29, 2021, Xinhua. The Lao government expects to earn its first income from the sale of carbon credit in 2022 after signing an agreement with the World Bank, Xinhua reported.
Local daily Vientiane Times on Friday quoted Deputy Director General of the Forestry Department Khamsene Oukham as saying that the government had signed an agreement with the World Bank to sell carbon credits from designated forest areas in the six northern provinces of Huaphan, Luang Prabang, Oudomxay, Luang Namtha, Bokeo and Xayaboury.
“We expect to receive about 15 million U.S. dollars from the sale of carbon credit in 2022,” said Khamsene.
The actual amount of money earned will depend on the amount of carbon credits available from these areas.
Under the agreement with the World Bank, the relevant sectors will reassess the production of carbon credit from the designated areas in 2022 to determine the total amount of carbon credits available.
“If we are unable to protect forest areas, there will be less carbon credits and we will not earn so much from this business arrangement,” Khamsene added.
According to the World Bank, the international financial institution has committed a budget of about 42 million U.S. dollars under the Forest Carbon Partnership Facility to purchase carbon credits from Laos from 2020 to 2025.
The Bank’s initiative aims to reduce carbon emissions released into the atmosphere, one of the main causes of global warming and extreme weather patterns around the world.
Developing, developed nations and major corporates have agreed to buy carbon credits from countries as part of their social business responsibilities, said the report.
Forestry officials say the Lao government is strongly committed to protecting forests and hopes to earn income from sale of carbon credit.
In order to protect forest areas, forestry officials say the government will use money earned from the sale of carbon credit as well as sourcing funds from development partners to reduce poverty in the designated areas.
People in communities surrounding the designated forest areas need to have sustainable jobs and income so they do not encroach into forests and be lured by businesspeople to fell trees for sale, according to Khamsene.