Clean Development Mechanism (CDM) in Least Developed Countries


This two-year US$ 50,000 project helped Least Developed Countries to develop their capacity in projects under the Kyoto Protocol's Clean Development Mechanism (CDM) and participate in the emerging global market in emission permits for greenhouse gases. It supported the creation of public-private bodies in developing countries for CDM projects and.worked particularly with agencies in Tanzania.


This project was part of the UNCTAD/Earth Council Institute Geneva (ECIG) Carbon Market Programme. It was conceived and developed by the participating LDCs with support from UNCTAD/ECIG. It built on international mandates agreed at the COP (Conference of Parties) of the UN Framework Convention on Climate Change and the 2001 United Nations LDC III Conference [PDF] in Brussels. The Convention has been signed and ratified by 46 LDCs.


The project itself responded to the call for a prompt start to CDM and the equitable distribution of CDM amongst developing countries, in particular LDCs. The LDCs are the most vulnerable and have the least capacity to adapt to adverse effects of climate change. But they recognize that combating climate change and its adverse effects require global and cooperative approach. The Convention and the Kyoto Protocol provide opportunities for sustainable development through access to cleaner technologies and additional investment opportunities such as the CDM.

The Convention explicitly recognizes the situation of LDCs. Under Article 4.9 it urges developed countries to pay special consideration to the needs of the LDCs, particularly actions on funding and technology transfer. Under the Kyoto Protocol, CDM projects implemented in LDCs are exempt from its adaptation levy. In addition, small-scale CDM projects are facilitated through simplified procedures.

However, these provisions are not enough to attract CDM investors to LDCs because of these countries' low technical and institutional capacity. As a result, LDCs must be both proactive and innovative in attracting CDM investments, in particular by improving the investment climate and environment. The project aimed at getting this process started in LDCs through a learning-by-doing approach.



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