Carbon trading unlocks opportunities
DAR ES SALAAM: CARBON trading is emerging as one of the country’s fastest-growing green economy opportunities, with potential to boost agricultural productivity, increase rural incomes and strengthen climate resilience through carbon credit markets.
Through climate-smart agriculture, mixed farming systems and conservation-based practices, farmers are increasingly being linked to carbon credit projects that reward them financially for reducing emissions and protecting natural ecosystems while contributing to global climate action.
Minister of State in the VicePresident’s Office, Engineer Hamad Yussuf Masauni, said carbon trading presents a major opportunity to transform the agriculture sector and expand economic opportunities for smallholder farmers.
“Through the expansion of financial services, the use of digital systems and collaboration with other financial institutions, more farmers will benefit from loans, financial education and investment opportunities in modern agriculture,” he said.
He made the remarks while officiating the launch of the Tanzania Agricultural Development Bank (TADB) Green Financing Strategy for the agriculture sector 2025–2027, held on Tuesday in Dar es Salaam.
Literatures show that carbon trading per hectare currently generates modest but gradually increasing returns for farmers, typically ranging from about 5.0 US dollars to 30 US dollars per hectare per year in many smallholder agroforestry and soilcarbon projects, depending on project structure, carbon prices and verification systems.
“Strong cooperation among government institutions, development partners, financial institutions, research institutions, civil society organisations and the private sector will be important in mobilising resources, enhancing innovation and enabling farmers to transition to climate-smart agriculture,” he said.
The government has previously estimated registered carbon projects could generate about 1.0 billion US dollars (2.6tri/-) once fully operational.
Vice-President’s Office Permanent Secretary Dr Richard Muyungi said the strategy comes at a critical time as the government prepares to launch the country’s Greening Strategy, which aligns with Development Vision 2050 and requires substantial financing to reach communities.
Tanzania Agricultural Development Bank (TADB) Managing Director Frank Nyabundege said climate change continues to inflict heavy losses on the agriculture sector through floods, droughts and rising temperatures.
He said recent studies show the sector loses an average of 28 million US dollars annually due to reduced production, alongside 140 million US dollars in losses from extreme weather events.
