Navigating Guyana’s Carbon Market dilemma

In December 2022, the South American nation of Guyana took a significant leap into the global carbon market by selling the first jurisdictional carbon credits, a move that heralded important financial gains while also raising serious concerns about effective inclusion of Indigenous Peoples in decision-making in national policies that impact their lands and lives.

In March of 2023, the Amerindian Peoples Association (APA) filed a complaint with the Architecture for REDD+ Transactions (ART) Secretariat to present its concerns about its carbon credit certification process because our work with indigenous communities over the years also reveal that there are crucial unresolved land tenure issues. Having studied the process and finding several shortcomings based on information shared during meetings with APA’s member communities, the complaint cited the lack of consultation and consent from villages. It also asserted that the government of Guyana failed to meet crucial safeguard requirements for the credits to be certified under the ART TREES standard.

During the organization’s community outreaches, villages have stated that consultations on carbon financing were substandard and focused on the country’s Low Carbon Development Strategy rather than the ART crediting process. Furthermore, villages had requested more information on carbon sales and the impact these sales would have on communities, but had not received any follow-up sessions from the government.

The government of Guyana claims that consultations and approvals were done through the National Toshaos Council (NTC), a body of elected leaders from Indigenous villages whose mandate, according to the Amerindian Act, is to serve in an advisory capacity to the government. The NTC does not have the mandate to make crucial decisions regarding community lands. Indigenous communities’ right to communal decisionmaking is vested in the Village General Meeting and represented by the Village Councils. The State’s claim that the NTC has “legal authority to represent” indigenous peoples has allowed the State to bypass indigenous peoples’ representative institutions. The State’s claim that Indigenous Peoples have consented to carbon trading is misleading. This process of consent was not followed. Therefore, APA’s complaint sought to highlight how the carbon programme and credit sale undermined the villages’ legal decision-making process.

No doubt due to the economic potential of the pending sale, the APA complaint triggered public debate about Guyana’s National Carbon Credit Programme (NCCP), an initiative that has already begun dispensing 15% of the country’s USD$750M carbon credit sale from Hess Oil to Indigenous and local communities over several tranches. While some communities have reported positive outcomes from this programme, others have highlighted the lack of consultation, preparation and guidance for using these funds, leading to confusion, division and malpractices in its administration.

With approximately 85 percent tropical forest-cover, Guyana is an ideal participant in the forest carbon market. The mechanisms outlined in the Cancun Safeguards under the United Nations Framework Convention on Climate Change (UNFCCC) could go a long way to ensure economic security as well as environmental integrity for our country, but only if the standard bodies adhere to the fundamental principles of respect for rightsholders, particularly Indigenous peoples.

Unfortunately, this first sale in Guyana did not rise to that occasion. Despite the APA’s informed objection, the ART Secretariat dismissed the complaint, triggering an appeal that fell apart in October 2023 before even starting. The breakdown occurred as the Secretariat refused to negotiate the terms of the appeal review process with the APA, signaling a lack of willingness to engage in a fair and transparent appeals process.

In addition to revealing weaknesses in ART’s TREES standard, validation and verification process, as well as the shortcomings of their current grievance mechanism, the case has also pointed to potential pitfalls for international voluntary carbon markets. The APA, with its three-decade track record of advocating for Indigenous peoples’ rights in Guyana, comprising members from communities throughout the country, is neither antidevelopment nor anti-carbon market. However, without the effective engagement of those communities whose forests are in question, the initiative is more likely to become marred in conflict before making any meaningful impact.

Indeed, we need to look no further than Guyana’s

iconic Kaieteur National Park, home to the world’s largest single-drop waterfall, to underscore what is at stake when governments want to achieve environmental goals without due consideration of rightsholders and local stakeholders. Ambiguities arose when the government extended the park’s boundaries in 1999 without consulting the Patamona People of Chenapou, a village within the same territory as the National Park. This has led to clashes over restrictions to the use of customary resources that, unfortunately, continue to this day.

Inevitably, the sale of carbon credits in Guyana—or in nearly any rainforest territory—intersects with issues of human rights and Indigenous peoples’ land tenure rights. Approximately 36% of the world’s remaining primary forests and at least 24% of the above-ground carbon in tropical forests are located within Indigenous peoples’ territories. Without explicit and legally binding commitments that guarantee the rights of Indigenous peoples, the carbon market will continue to undermine the world’s most effective forest guardians.

This international support letter, signed by 30 Indigenous and local community and environmental organizations from around the world, amplifies the call for the ART Secretariat and the government of Guyana to engage in sincere dialogue with APA regarding the concerns they raise, and to address these concerns before a subsequent round of ART credits are approved in Guyana.

As highlighted during COP 28 “voluntary” carbon market (VCM) has been under intense scrutiny this year, after highprofile investigations highlighting its shortcomings.” It is critical that major carbon crediting standard administrators, their validation and verification bodies, and potential buyers seriously note how complaints in crediting activities are handled to ensure rights protections are effectively respected and that underlying issues are adequately addressed. Failure to do so may not only exacerbate conflicts in Guyana but could cast a shadow over the integrity of forest carbon markets across the globe.

Nicholas Peters is the Advocacy and Policy Support Officer for the Amerindian Peoples Association (APA), a non-governmental organization that advocates and promotes the rights and development of the Indigenous peoples of Guyana since 1991.