Page 188 - 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

3.3 Countermeasures for the Development of Forestry Car-
bon Sequestration Transactions in China under the “Double
Carbon” Target

3.3.1 domestic forestry carbon sink project development “overheating” phe-
nomenon still needs to be vigilant

The development of forestry carbon sequestration projects in China has experi-
enced two adjustment periods, namely, the stagnation of CDM projects and the sus-
pension of development of domestic CCER projects. At present, it is facing a window
period of restart again. Although the institutional environment for the development
and trading of forestry carbon sequestration projects in China has become increasingly
mature, it should be noted that the carbon market in China is still in the initial stage of
construction, and the actual market demand of forestry carbon sequestration projects is
still difficult to predict accurately. According to the long-term observation of the inter-
national carbon market, the stock of forestry carbon sequestration projects accounts for
a relatively low share of the carbon market. As of May 2023, registered forestry carbon
sequestration projects accounted for only 0.7% of all project types in the CDM mar-
ket. At present, under the guidance of the “double carbon” target, China has issued a
series of policies to vigorously support the development and trading of forestry carbon
sequestration projects. However, at the same time, it is also necessary to guard against
the “overheating” in the development of forestry carbon sequestration projects and the
over-expectation of project revenue, so as to avoid over-development of forestry carbon
sequestration projects in various regions. From the central government to the local gov-
ernment, it is necessary to fully realize the current situation of the forest carbon seques-
tration market in which the supply exceeds the demand, and to make a more accurate
prediction of the market demand for forest carbon sequestration projects in the future
national carbon market, so as to accurately control and rationally distribute the forest
carbon sequestration projects in China in the aspects of project approval, issuance, etc.,
and to scientifically encourage and guide various social entities to participate in the
practice of forest carbon sequestration project development.

3.3.2 the multiple values of forestry carbon sequestration projects urgently
need policy support

In addition to increasing foreign exchange, forestry carbon sink projects need ade-

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