Tanzania secures $463m for climate projects from COP29 commitments

Dar es Salaam. The government has announced that it has received $463.31 million (Sh1.1 trillion) out of the $782.2 million (Sh1.944 trillion) pledged at COP29 for environmental conservation and climate change initiatives. 

The funds are now available for the implementation of projects, which were set to begin in March this year.

Tanzania’s participation in COP29 resulted in a commitment of $782.2 million (about Sh1.944 trillion) for various environmental conservation and climate change efforts. 

This was disclosed on Friday, April 25, 2025, in Parliament by the Minister of State in the Vice President’s Office (Union and Environment), Mr Hamad Masauni, as he tabled his ministry’s 2025/26 budget proposal, which seeks Sh81.86 billion—an increase from last year’s Sh62.68 billion.

“The agreements made at the summit, which bring significant national benefits, include the operationalisation of the Loss and Damage Fund to address climate change impacts, the creation of a transparent system for managing intergovernmental carbon trading, and the approval of tree planting projects to be included in carbon trading schemes,” he said.

Regarding carbon trading, the minister noted that some regions are already benefiting.

A total of Sh45 billion has been paid to citizens in ten districts as dividends from the sale of carbon credits. 

“I urge both public institutions and the private sector to integrate carbon trading into their development strategies,” he added.

However, a recent audit by the Controller and Auditor General (CAG) reveals that Tanzania has lost a staggering Sh1.26 trillion in potential revenue from carbon trading. 

This is due to poor coordination, inadequate guidance, and limited public awareness. 

Despite the country’s active participation in global climate change mitigation, the CAG’s Performance Audit Report on Carbon Trade Projects highlights missed opportunities and underutilised potential in one of the world’s fastest-growing environmental finance markets.

Carbon trading allows countries and companies to earn money by reducing emissions and selling credits to those exceeding their emission limits. 

This mechanism not only helps mitigate climate change but also offers developing nations like Tanzania the chance to generate significant income to fund local development.

Between January 2023 and July 2024, Tanzania generated just Sh36 billion from carbon credit sales, only 3 percent of the Sh1.26 trillion the country could have earned. 

The shortfall is attributed to delays in implementation, lack of strategic direction, and limited stakeholder engagement in the sector.

“The government has not fully harnessed its carbon trading potential due to insufficient guidance and low awareness among key stakeholders,” the CAG report states.

The audit also revealed that of the 56 carbon trading projects registered during the review period, only four reached the implementation stage. 

The remaining 52 stalled at the planning phase due to delays in proposal reviews, a lack of capacity assessments, and limited follow-up by the Vice President’s Office (VPO), which oversees the National Carbon Monitoring Centre (NCMC).

In Parliament, Mr Masauni acknowledged that carbon trading remains an unfamiliar concept to many Tanzanians.

He encouraged the public to make full use of the national carbon coordination centre to seek expert advice on how to engage in this trade, which drives economic growth and contributes to environmental conservation.

For the 2025/26 fiscal year, the government has outlined several environmental and climate resilience initiatives. 

Among these is the sustainable restoration of ecosystems and biodiversity conservation. 

This project aims to strengthen integrated environmental management and rehabilitate degraded land to boost the resilience of both ecosystems and communities across Tanzania.

“Other planned initiatives include a climate resilience project targeting communities in woodland areas in both Mainland Tanzania and Zanzibar. The goal is to reduce the impacts of climate change and enhance the adaptive capacity of these ecosystems and surrounding communities,” Mr Masauni said.

On Union matters, particularly the coordination of economic and social issues and dividend distribution to Zanzibar, the government reported continued progress. By March 2025, Sh49.2 billion had been disbursed to Zanzibar.

Furthermore, the government has been overseeing the implementation of high-priority projects in Zanzibar, including monitoring those financed by the State Development Fund across the Isles' 50 regions. 

As of March, Sh2 billion had been allocated for these projects, which span the education, health, water, infrastructure, and energy sectors.

Meanwhile, Dr Joseph Mhagama, chairman of the Parliamentary Committee on Governance, Constitution, and Legal Affairs, urged the government to ensure the timely disbursement of development funds and resources to enable ministries, departments, and agencies to effectively execute their responsibilities. 

He also called for ongoing monitoring and assessment of Union-related development projects.