The Financial Regulatory Authority (FRA) convened a meeting to discuss the latest developments in the voluntary carbon market and how to speed up its activation. The meeting was attended by representatives of about 35 companies from various economic sectors involved in the voluntary carbon market, as well as officials from the Egyptian Exchange and Taswiat company.
Mohamed Farid, the FRA chairperson, highlighted the efforts and measures taken by the authority to prepare for the launch of the voluntary carbon emission reduction certificate trading market. He also updated the attendees on the progress made by the Egyptian Exchange and Taswiat company in implementing the necessary steps for the market’s operation. He stressed the importance of enabling economic entities to comply with international standards and requirements.
Farid explained the significance of establishing and activating a market for trading voluntary carbon emission reduction certificates, which was announced by the FRA and the Egyptian Exchange at the climate summit COP27 in Sharm El-Sheikh last year. The summit was attended by Prime Minister Mostafa Madbouly. The goal is to encourage various productive entities to reduce their emissions through adaptation and mitigation projects and to issue certificates in the new market that allow them to recover some of their investment costs directed towards emission reduction. These resources can then be reinvested in achieving the ultimate objective of carbon neutrality, which is a global aspiration.
Farid added that carbon emission reduction is not a “luxury” but a prerequisite for international trade. The authority has created a registry of entities authorized to verify or validate carbon emission reduction projects for trading purposes. It has also set criteria for Egyptian and foreign entities, which were developed by the Supervisory Committee on Carbon Emission Reduction Units. The committee consists of representatives from the Ministry of Environment, the Egyptian Exchange, and specialized experts.
At the end of the meeting, the companies’ representatives expressed their keen interest in participating in the market. They also engaged in discussions with the authority’s management to address their inquiries and prepare for specialized training programs and workshops on this topic.
He concluded that the carbon emission reduction certificate trading market is a platform to assist economic entities in Egypt and Africa to undertake carbon emission reduction activities and benefit from issuing and selling certificates based on their reduction efforts. These certificates can be purchased by other companies that want to offset their hard-to-reduce carbon emissions. This requires organized and incentivizing regulatory controls to initiate and grow this market, as well as to enhance companies’ capacity to adopt environmental practices to achieve carbon neutrality.