Page 92 - 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

cations and give certain preferential policies to insurance companies and insured forest
producers. Secondly, it is necessary to increase publicity and education and training,
improve the public’s awareness of forest insurance and increase the rate of forest insur-
ance. Finally, aiming at the specific risks of forestry carbon sequestration projects, ac-
tively carry out insurance type innovation and develop a full-coverage forestry carbon
sequestration insurance suitable for forestry carbon sequestration projects.
2) Optimize the project design
The most important risk faced by carbon sink projects is the risk of carbon leakage.
In the process of designing forestry carbon sink projects, the potential inducing factors
of carbon leakage should be fully considered. First of all, when selecting the project
site, the environmental characteristics and residents’ activities of the region should be
combined to consider the behaviors that all the activities in the region will take place
in the process of project implementation, and to simulate the consequences that certain
behaviors will be restricted or prohibited by the forestry carbon sink project. Secondly,
it provides a reasonable basis for the compensation mechanism for farmers involved
in the project, so that the compensation can truly play the role of motivating farmers
to protect forests and forestation, and ensure the sustainability of the project. Finally, it
is necessary to deduct the amount of carbon sinks expected to be generated by carbon
sink projects, and the deduction rate should be determined by an authoritative third-par-
ty certification authority and determined by experts with professional knowledge and
experience.
3) Improve the relevant supporting facilities in the carbon market
The successful completion of forestry carbon sequestration transactions and the
successful implementation of forestry carbon sequestration projects depend on the co-
operation of a series of supporting institutions. The exchange of carbon emission rights
can realize the exchange and integration of various kinds of information, provide a trad-
ing place for both parties to the transaction, and establish a foundation for the forma-
tion of the trading price and the formation of the carbon sink trading mechanism. Car-
bon asset management companies mainly provide low-carbon management consulting,
corporate carbon emission management, corporate carbon asset management and other
services for enterprises with emission reduction needs. The third-party monitoring and
certification body is mainly responsible for evaluating the additionality and economy
of forest carbon sinks, so as to determine the economic value of forest carbon sinks and
lay the foundation for carbon sink transactions and carbon sink financing. At the same
time, follow-up monitoring of carbon sink projects is carried out to ensure the smooth

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