1. Themes
  2. Carbon Markets
  3. International Carbon Markets

International Carbon Markets

International carbon markets are primarily used for voluntary carbon credit purchases and remain a critical pathway for climate finance to reach EMDEs. Future scale likely hinges on the development of Article 6 of the Paris Agreement to standardize carbon markets.

2030 Goals

01

Carbon markets operate internationally with clear guidelines, standards, and accountability mechanisms on both the supply and demand sides, and are able to mobilize significant finance for adaptation and mitigation projects reducing, avoiding, or removing emissions in EMDEs

02

Bilateral donors and MDBs support African Carbon Markets Initiative for advanced market commitment for high integrity (ICVCM approved) projects from governments and private sector ($100m) for voluntary and Article 6 use.

03

There will be continuous assessment and improvement of standards and guidelines operationalizing Article 6 in upcoming COP negotiations. The recent COP 30 discussed on the ambition of having transparent, high-integrity carbon trading frameworks that prevent double counting, ensure robust MRV systems, and align with countries’ NDCs to accelerate achievement of global climate targets.

Status

No Progress

Although there is considerable focus on international voluntary carbon markets, a lack of trust in integrity of credits has limited buyer growth, shrinking the size of the market by 50% compared to 2021

Under Article 6 of the Paris Agreement, the trade of carbon credits could generate savings of up to USD 250 billion in meeting climate targets and nearly double the level of ambition among countries. As of late 2025, 97 bilateral agreements have been signed among 56 countries, covering diverse sectors from renewable energy to forestry.

COP29 achieved a breakthrough as participants reached a consensus on operationalizing Article 6, agreeing on a set of standards and guidelines to unlock voluntary international carbon markets under the Paris Agreement through both market and non-market mechanisms. However, many details remain to be ironed out. Recent Expansions of Article 6 Bilateral Agreement by Switzerland (to include Zambia, Uganda, and Mongolia) and Singapore (to include Malawi & Bhutan) is a significant development in getting Internationally Transferred Mitigation Outcomes (ITMOs) flowing under the Paris Agreement framework.

Leading Actors

Cooperation is required between these actors and audiences to drive progress foward in International Carbon Markets.

Private FIs

Joint Crediting Mechanism (JCM)

Public FIs

Japan Bank for International Cooperation

Multilateral Development Banks

Asian Development Bank (ADB)

Multilateral Development Banks

World Bank

International Organizations

OECD

International Organizations

CORISA

Leading Countries

Japan

Leading Countries

Switzerland

Supportive Stakeholders

Voluntary Carbon Markets Integrity Initiative

Supportive Stakeholders

Integrity Council for the Voluntary Carbon Market

Supportive Stakeholders

Africa Carbon Markets Initiative

Supportive Stakeholders

Climate Market Club

Supportive Stakeholders

International Carbon Action Partnership

Supportive Stakeholders

Taskforce for International Carbon Pricing and Markets

Learn More

Publications and educational material to deepen understanding of International Carbon Markets.

Carbon Market Regulations Tracker

International Carbon Markets

The Carbon Market Regulations Tracker is developed to enhance the understanding and transparency of carbon market regulations, and support governments, project developers, investors, and other market participants in navigating the evolving regulatory landscape.

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State and Trends of Carbon Pricing: International Carbon Pricing 2024

International Carbon Markets

Well-designed, high integrity carbon markets can play a pivotal role in financing climate action in developing countries. However, several critical bottlenecks impede the growth of these markets. The 2024 State and Trends of International Carbon Markets report evaluates the progress made in addressing these bottlenecks, highlights the urgency of these issues, and proposes recommendations to ensure that carbon markets reach their full potential.

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Related Topics

International Carbon Markets | Climate Finance Reform Compass