Three Governments Advance Article 6 Carbon Trading

Carbon market infrastructure is expanding across emerging economies, as governments and exchanges move to formalise the creation, trading, and cross-border sale of carbon credits under Article 6 of the Paris Agreement.

A business meeting exploring the growing carbon markets in Kazakhstan, Ecuador and Madagascar and their role in global carbon trading. AI generated picture.

The clearest sign is in Kazakhstan, where the Astana International Exchange (AIX) has begun trading carbon credits verified under the Verified Carbon Standard. The exchange, part of the Astana International Financial Centre (AIFC), is the first in Central Asia to run its own trading infrastructure for the instrument. London-based Valor Carbon supplied the opening credits, cleared through the broker Standard International Market, and the credits now trade alongside International Renewable Energy Certificates (I-RECs).

AIFC chairman Bakhtiyar Tleubekov tied the launch to the financing gap facing regional developers. “Carbon projects are increasingly emerging in Central Asia, and attracting financing remains a key issue for their development,” he said. “The AIFC’s role is to build infrastructure that gives such projects access to capital.”

The exchange move builds on a December memorandum with US-based standard BCarbon and an Article 6 operating manual published in August that set out application, authorisation, and timeline procedures for developers. Kazakhstan has operated Central Asia’s first emissions trading system since 2013, following suspensions in 2016 and 2017.

Ecuador has taken a legislative route. President Daniel Noboa signed a reform to the Organic Environmental Code that authorises credit sales abroad under Article 6, ending decades of legal uncertainty rooted in Article 74 of the constitution, which bars the appropriation of environmental services. The reform reclassifies credits as “quantifiable and verifiable effects” subject to public regulation and mandates a national carbon registry to track exports.

Madagascar has focused on strategy. In an updated Nationally Determined Contribution (NDC) submitted to the UN this week, the country — already a major supplier of Eligible Emissions Units to the Corsia aviation market — named forests, energy efficiency, climate-smart agriculture, waste, and blue carbon as its Article 6 priority sectors. Its NDC 3.0 frames Article 6 as a complement to concessional finance rather than a replacement, and sets contingent requirements of $5.33 billion against unconditional mitigation funds of $2.53 million.

The differing approaches feed into COP31 in Antalya, Turkey, this November, where emerging economies will seek a larger share of grant-based funding under the finance mechanism agreed in principle at COP29 in Baku.