Does Latin America hold the secret to the world’s carbon sinks?
Many of carbonABLE’s projects take place in South and Central America. Wonder why?
The potential of tropical rainforests
Our mission at CarbonABLE is to allow the highest number of investors to participate in restoring the planet’s carbon sinks as possible. To do so, we need to have many high-quality projects available to finance. Latin America has got those projects. And it’s also got the climate mitigation potential to make a huge dent in the fight against climate change.
According to the World Research Institute:
“Tropical rainforests collectively sequester more carbon from the atmosphere than temperate or boreal forests, but they’re also increasingly destroyed for agricultural expansion. The world’s three largest tropical rainforests are located in the Amazon, Congo River basin and Southeast Asia.”¹
The world’s largest tropical forest, the Amazon, has suffered enormous deforestation due to clearing the land for cattle. If deforestation does not slow down and eventually reverse in the Amazon, this essential forest could reach its tipping point and irreversibly transform into a savannah.
Latin America: rainforest hotspot
Europe is home to mostly temperate deciduous and coniferous forests, as well as boreal forests. These are fine for stocking carbon but don’t grow very quickly. Latin America however, has much larger swaths of forests or deforested areas, and the climate allows for quick growth — in tree-time. The Amazon forest stretches across Brazil, Bolivia, Peru, Ecuador, Colombia, Venezuela, Guyana, Suriname, and French Guiana.
But it’s not the only valuable forest in Latin America; Central American countries like Costa Rica, Panama, Guatemala, and Nicaragua have significant forest areas that have already been damaged or are at risk of being damaged further.
Activists and NGOs in these countries are aware that this needs to change. The region “can position themselves as the world’s largest providers of carbon credits,” according to the Development Bank of Latin America, thanks to the existing framework and the possibility for new projects to emerge.²
From 2020–21, almost 20% of voluntary carbon credits globally came from projects in Latin America.³ The majority of projects are based on nature-based solutions or forestry. The Inter-American Development Bank (IDB) released a report analyzing forecasts for the region and sector, and found that Brazil, Peru are the largest contributors.⁴
But what about (insert another country here)?
But what about other areas with lush forests in danger? Aren’t they important too? Yes! But at the moment a lot of our projects happen to take place in Latin America. That doesn’t mean that one day we won’t finance a project in Indonesia, in Cameroon, Madagascar, or even Europe.
Big change, fast
Our mission is to fight climate change using DeFi now. Our nature-based NFTs represent real plots of carbon sinks that are being restored or preserved. By using blockchain technology, we clean up many of the typical problems of carbon credits, like transparency and traceability. And today, many of the projects we finance are rewilding South America. But tomorrow? They could be anywhere in the whole world!
Sources
(1) https://www.wri.org/insights/forests-absorb-twice-much-carbon-they-emit-each-year(2) https://www.caf.com/en/knowledge/views/2021/12/moving-towards-a-latin-american-carbon-market/(3) https://www.bnamericas.com/en/news/snapshot-the-latam-countries-with-carbon-pricing-instruments-in-place#:~:text=Latin%20America%20is%20also%20the,bulk%2C%20followed%20by%20renewable%20energy.(4)https://mcusercontent.com/756811632e218c4eff4f54e77/files/14705ca6-454a-c191-dd92-9c4e1333e3fd/IDB_Report_2021.pdf
