Page 166 - Research on Financial Development Mechanism and Path of Forestry Carbon Sequestration in Developing Countries under Double Carbon Targets

Research on Financial Development Mechanism and Path of Forestry Carbon
Sequestration in Developing Countries under Double Carbon Targets

bon sink of the forest segment can be adjusted to measure the carbon credits that can be
earned. For example, forests in most deciduous (hardwood) areas have a carbon sink of
not less than 2 tons per acre per year.
The specific process of forest carbon sequestration transaction. The majority of U.S.
commercial entities involved in the transactions are large companies or other fossil fuel
producers of coal, natural gas or oil. When participating enterprises fail to meet the
emission reduction targets, they must purchase carbon credits from other individuals
(exceeding the emission reduction targets) or from carbon sink projects to “offset” the
excess emission targets. Forest owners are certified by certification bodies to enter the
carbon sink trading market and give carbon credits to these entities through carbon ag-
gregators. Credits are traded by corporate entities (large) or carbon aggregators (small)
registered with the Chicago Climate Exchange.

Section 2 Practice of Forestry Carbon Sequestration

Finance in Developing Countries

Under the background that global climate change has become a global issue, carbon
sink finance has gradually become one of the important means to solve the problem of
climate change. As the world’s largest developing country, China has played an import-
ant role in promoting carbon sink finance. Especially in developing countries, forestry
carbon sink finance has great potential to promote sustainable development and protect
the ecological environment.
Developing countries face many challenges, such as poverty and lack of resourc-
es, which also make them more vulnerable to the impact of climate change. However,
they are also rich in forest resources in the world. Based on this, the concept of forestry
carbon sink finance in developing countries arises at the historic moment. The concept
aims to provide economic and environmental benefits for developing countries by man-
aging and protecting forest land as a carbon sink.
First, forestry carbon sink finance in developing countries can provide sustainable
economic growth for these countries. By properly managing forest land, developing
countries can transform it into sustainable wood and non-wood forest products, which
in turn can support economic development. At the same time, developing countries
can also obtain additional income by participating in the international carbon trading
market and selling their forestry carbon sinks. This is crucial to reducing poverty and

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