Page 178 - 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

3.1.1 Forestry Carbon Sequestration Project in China under the United Na-
tions Clean Development Mechanism (CDM)

Emission reduction trading is an important policy tool for international climate
cooperation. Among them, the CDM under the UNFCCC is the only mechanism cover-
ing developing countries and has dominated the climate cooperation practice between
developed and developing countries in the past 30 years. The mechanism allows devel-
oped countries to obtain CERs from CDM projects with developing countries for their
own emission reduction targets. As the largest developing country in the world, China
holds the largest number of CDM projects. According to the UNFCCC CDM data, as
of April 30, 2023, the United Nations had approved 6,234 CDM projects, of which 2,958
were from China, accounting for approximately 47% of the total global CDM projects.
China signed the Kyoto Protocol in 1998 and formally approved it in 2002. In 2004,
the National Development and Reform Commission, together with the Ministry of Sci-
ence and Technology and the Ministry of Foreign Affairs, formulated and issued the In-
terim Measures for the Operation and Management of Clean Development Mechanism
Projects in accordance with the UNFCCC and the Kyoto Protocol. In November 2006,
the “Guangxi Wetland Treatment and Reforestation Project in the Pearl River Basin of
China” was successfully registered with the CDM Executive Board, becoming the first
forestry carbon sink project successfully registered under the CDM in the world. Since
then, China has begun to cooperate with developed countries through CDM and partic-
ipate in the practice of international forestry carbon sequestration trading. So far, China
has successively carried out a number of CDM forestry carbon sequestration projects
in Sichuan, Yunnan and other places: the project focuses on afforestation and refor-
estation, and has both community development, biodiversity and other objectives; The
project cycle is 20 ~ 30 years; Five of these projects were successfully registered with
the CDM Executive Board and completed the transaction. The project design document
estimated that more than 80,000 farmers could be benefited, and the estimated annual
CO2 equivalent emission reduction could be about 180,000 tons.
However, with the expiry of the first commitment period of the CDM (2008-2012)
and the continued decline in carbon trading prices brought about by the European eco-
nomic crisis, the CDM market has taken a sharp turn for the worse since 2013. At the
same time, the CDM forestry carbon sink project in China has gradually exposed the
difficulties in system rules, project management, forest farmers’ participation mecha-
nism and other aspects, which has brought some difficulties to the subsequent devel-

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