The compliance-driven demand for credits from African CDM projects is plummeting, despite preferential treatment being given to least developed countries (LDCs) under the 3rd phase of the EU Emission Trading Scheme. Decreasing overall demand, combined with political uncertainty about the relevance of a (reformed) CDM in the new climate agreement, is driving CER prices down. However, beyond the current market state, the CDM remains a powerful tool, which once tailored to the context of the LDCs (Programmes of Activities, Standardised Baselines, etc.), has proven successful on the continent. Elements of the CDM can also serve as key building blocks for market mechanisms in the new climate regime, possibly mobilising climate finance at scale through public-private partnerships. The African Group has emerged as a key voice calling for continuation of a reformed CDM in the UNFCCC negotiations and should be influential in shaping the rules of these mechanisms.

To support this process, The German Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety (BMUB) has commissioned the project entitled “Strengthening the African CDM pipeline”. Climate Focus and its partners Ecosur Afrique and Perspectives have been retained by BMUB to carry out this project which continues until June 2016.