FRA Launches its VCM with First Trades Going Live

The Financial Regulatory Authority (FRA), under the leadership of H.E. Dr. Mohamed Farid, has launched Egypt’s first regulated and supervised Voluntary Carbon Market (VCM). This milestone event marks a significant step towards supporting the country’s efforts to achieve carbon neutrality and foster a robust lower carbon economy.

 

The (VCM) allows the registration of Voluntary Carbon Emission Reduction projects and the issuance and trading of carbon reduction certificates, The FRA collaborated with the Ministry of Environment to complete all regulatory requirements for this (VCM); through a carbon credits supervision and oversight committee including representatives from Ministry of Environment, The Egyptian Exchange (EGX) and key private sector stakeholders.

 

The launch event was attended by several key government officials, their presence underscored the strong government backing and the collaborative efforts across multiple ministries to ensure the success of this groundbreaking milestone, such as ministers H.E. Dr. Rania Al-Mashat, Minister of International Cooperation and Planning and Economic Development, H.E. Dr. Yasmine Fouad, Minister of Environment, H.E. Hassan El Khatib, Minister of Investment and Foreign Trade, H.E. Dr. Manal Awad, Minister of Local Development, H.E. Alaa Farouk, Minister of Agriculture and Land Reclamation, H.E. Mahmoud Fawzy, Minister of Parliamentary Affairs and Political Communication and Mr. Ahmed El Sheikh, Chairman of the EGX.

 

Key Participants and Transactions: During the launch event, three trades took place between of the private sector participants in Egypt’s new carbon market (VCM), namely:

 

• Isis Food Industries acquired 500 voluntary carbon certificates from the Egyptian Biodynamic Agriculture Association (EBDA) at EGP 1,040 per certificate. The transaction was facilitated by Beltone Securities Brokerage.

 

• SCB Environmental Markets purchased 2,500 carbon credits from VNV Advisory. This transaction highlights SCB's active participation in the inaugural trades and their commitment to supporting carbon reduction efforts through the newly established market.

 

• Daltex purchased 1,500 international Verra carbon credits from VNV Advisory for a total value of over EGP 1.3 million (USD 27,000). The credits were sourced from the Punjab Agroforestry Project in India, which spans over 500,000 hectares and aims to enhance smallholder farmers' incomes through carbon revenue while improving their livelihoods.

 

These transactions were executed through brokerage firms regulated and licensed by the FRA, namely, Beltone Securities Brokerage and CI Capital Securities Brokerage.

Additionally, a future contract was entered into between Misr Insurance Company and VNV Advisory.