Ethiopia Moves to Integrate Carbon Credits Into Banking System

June 9, 2026

Mintesinot Nigussie

Ethiopia is set to formally bring carbon credits into its banking and financial system under a draft federal proclamation that would recognise the climate assets as intangible collateral eligible for use in credit and lending arrangements.

The proposed legal framework, prepared by the Ministry of Planning and Development together with the Ministry of Finance and the Ministry of Agriculture, establishes a centralised structure for the governance of carbon markets.

Under the draft, carbon credits generated within the country would be treated as federal property by default, unless ownership is explicitly transferred through government-approved contracts.

To operationalise the system, the draft assigns the Designated National Authority under the Ministry of Planning and Development a coordinating role with the National Bank of Ethiopia in establishing a registry to record and secure financial interests in carbon assets.

Commercial banks and financial institutions would be permitted to accept registered carbon credits as security for loans, effectively bringing climate-related assets into mainstream credit operations.

Project developers would be required to register their activities in a central Ethiopia National Carbon Registry and undergo review by an inter sectoral committee tasked with assessing environmental baselines and compliance.