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Building Nigeria’s Carbon Market: Policy Framework for Domestic and International Trading

Author

Listed:
  • Tanko Fwadwabea

    (Sustainable Development Centre, University of Abuja, Nigeria. Industrial Inspectorate Department, Federal Ministry of Industry, Trade and Investment, Abuja, Nigeria,)

  • Francis Ameh David

    (Centre for Petroleum and Energy Resource Economics, University of Abuja, Nigeria.)

  • Kpazo Grigwu Amos

    (Industrial Inspectorate Department, Federal Ministry of Industry, Trade and Investment, Abuja, Nigeria,)

  • Musa Adamu Bature

    (Student-researcher at College of Criminal Justice Education, at Pagadian Capitol College, Pagadian City, Zamboanga Del Sur, Philippines 7016.)

Abstract

Nigeria’s pledge under the Paris Agreement to reduce greenhouse gas emissions demands innovative tools like carbon markets to complement traditional regulatory strategies. This study assesses Nigeria’s preparedness to develop a domestic carbon market and engage in international trading mechanisms under Article 6 of the Paris Agreement. Using qualitative policy analysis and secondary data from national laws, global frameworks, and recent literature (2020–2025), the study identifies critical gaps in legal clarity, carbon credit ownership, MRV systems, and institutional coordination. While the Climate Change Act (2021) offers a legal foundation, it lacks specific operational frameworks needed for effective carbon trading. The study proposes a phased approach, beginning with voluntary markets in sectors like forestry and clean cooking, progressing to compliance-based systems. Key recommendations include legislative updates, regulatory reforms, institutional capacity building, and alignment with international standards. A well-structured carbon market will support Nigeria’s low-carbon transition, unlock climate finance, and drive sustainable economic development. This includes the newly launched Nigeria Carbon Market Activation Policy (2025) and the establishment of the Carbon Market Oversight Body (CMOB) to enforce integrity and coordination in the carbon market framework.

Suggested Citation

  • Tanko Fwadwabea & Francis Ameh David & Kpazo Grigwu Amos & Musa Adamu Bature, 2025. "Building Nigeria’s Carbon Market: Policy Framework for Domestic and International Trading," International Journal of Research and Scientific Innovation, International Journal of Research and Scientific Innovation (IJRSI), vol. 12(6), pages 266-274, June.
    • Handle: RePEc:bjc:journl:v:12:y:2025:i:6:p:266-274
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    References listed on IDEAS

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    1. World Bank, "undated". "State and Trends of Carbon Pricing 2023," World Bank Publications - Reports 39796, The World Bank Group.
    2. World Bank, "undated". "State and Trends of Carbon Pricing," World Bank Publications - Reports 40700, The World Bank Group.
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