Nigeria has officially launched its National Carbon Market Framework (NCMF), marking a significant milestone in the country’s climate strategy and economic diversification agenda. Expected to generate between $2.5 billion and $3 billion annually over the next decade, the framework is central to Nigeria’s plan to mobilise climate finance, drive its energy transition, and secure a prominent role in the global carbon economy. The initiative, formally approved by President Bola Tinubu, reflects an increasingly strategic approach to environmental stewardship, economic growth, and international competitiveness.
The launch aligns with Nigeria’s broader climate agenda, including the activation of the Climate Change Fund and the reinstatement of the National Council on Climate Change (NCCC) into the national budget. These measures aim to create a sustainable financial ecosystem capable of supporting climate-resilient projects and clean-energy investments, while also positioning Nigeria as a significant participant in both the voluntary and international carbon markets.
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The NCMF establishes the legal, institutional, and procedural architecture for generating, validating, and trading carbon credits domestically and internationally. By formalising the mechanisms for carbon credit transactions, Nigeria is opening pathways for foreign direct investment into its energy, agriculture, and industrial sectors. The framework is designed to incentivise private sector engagement in carbon reduction initiatives, offering verifiable benefits for companies seeking to meet global environmental standards.
Vice President Kashim Shettima highlighted that the framework positions Nigeria to fully harness opportunities for climate finance from multilateral funds and the global voluntary carbon market. According to Mrs Omotenioye Majekodunmi, Director-General of the NCCC, the council’s recommendations, including operationalisation of the Climate Change Fund and full budgetary inclusion for the NCCC, ensure that the country is financially ready to mobilise investments in low-carbon infrastructure and climate-adaptive projects.
Strategic Alignment with Global Climate Goals
Nigeria’s adoption of the NCMF follows its active participation in the 30th United Nations Climate Change Conference (COP30) in Belem, Brazil, in 2025, signalling the country’s continued commitment to international climate governance. The framework not only reinforces Nigeria’s dedication to fulfilling its Nationally Determined Contributions (NDCs) under the Paris Agreement but also strengthens its credibility in securing global climate financing.
Minister of Finance Wale Edun emphasised the importance of monitoring and coordination, announcing plans to host a quarterly Climate Finance Tracking Dashboard. This platform will ensure transparency, track carbon credit transactions, and provide stakeholders with real-time insights into Nigeria’s climate finance flows. Such mechanisms are essential for integrating Nigeria’s carbon market into the wider global carbon economy, which the World Bank estimates to be valued at over $200 billion annually, with voluntary carbon markets expected to grow substantially in the coming years.
Driving Sustainable Development and Investment
Beyond environmental objectives, the NCMF is expected to catalyse economic transformation. By monetising emissions reductions, Nigeria can attract investment in renewable energy, energy efficiency, and climate-smart agriculture, generating employment and technological innovation across multiple sectors. Analysts predict that over the next decade, the carbon market could significantly contribute to Nigeria’s GDP while enhancing the country’s climate resilience and energy security.
President Tinubu affirmed that climate action is integral to national development, stressing that Nigeria’s proactive approach in the carbon market will showcase its leadership in environmental governance. The framework is designed to position Nigeria alongside countries actively leveraging carbon markets as a tool for both climate action and economic competitiveness, including South Africa, Kenya, and Morocco.
A Framework for the Future
The NCMF represents more than a market mechanism; it is a strategic instrument for integrating environmental accountability with economic growth. By combining domestic regulatory rigour with global market participation, Nigeria is signalling its intent to be a major player in the global carbon economy. Over time, this framework has the potential to transform the country’s climate financing landscape, promote green investments, and foster a more resilient, sustainable economic model.
As Nigeria charts this new course, the integration of the NCMF into national development plans, coupled with robust governance and transparent financial tracking, will be critical. The success of this initiative will not only depend on policy implementation but also on the engagement of private sector investors, international partners, and civil society, creating a comprehensive ecosystem for sustainable development.
The National Carbon Market Framework is a decisive step towards positioning Nigeria as a climate-conscious economic leader, leveraging global carbon finance to support both environmental stewardship and economic prosperity. If implemented effectively, it could generate billions in revenue, attract foreign capital, and serve as a model for other African nations seeking to merge climate action with sustainable growth.
