As the world confronts intertwined climate and finance crises while seeking to advance on the Sustainable Development Goals (SDGs), carbon markets are increasingly seen as key drivers of climate ambition and capital flow.

They enable countries to trade carbon credits – permits to offset a specific amount of emissions – allowing sellers to earn revenue and contribute to climate action.

The least developed countries (LDCs) are already engaged in carbon markets and among the early movers in emerging trading mechanisms under Article 6 of the Paris Agreement.

The Least Developed Countries Report 2024 examines how these markets could bridge gaps between economic growth and climate action in LDCs and mobilize capital for sustainable development.

It makes clear that while carbon markets offer promise, they are not a substitute for official development assistance or climate finance. Instead, they serve as one of many tools to support LDCs’ green structural transformations and global emissions goals.

Using data-driven analysis and case studies, the report provides a roadmap for LDCs and their development partners to unlock the potential of carbon markets for sustainable growth.

Report by the United Nations Trade & Development