Papua New Guinea and Carbon Trade: Forests, Biodiversity, Blue Carbon, and Grey Carbon

Papua New Guinea (PNG) is one of the world’s most ecologically rich countries, renowned for its vast tropical forests, extraordinary biodiversity, and extensive coastal and marine ecosystems. These natural assets position PNG as a critical player in the global carbon trade, particularly through forest-based carbon, biodiversity-linked carbon markets, blue carbon from coastal ecosystems, and emerging discussions around grey carbon linked to human-made systems and land-use change. As global efforts to combat climate change intensify, PNG’s role in carbon markets offers both opportunities and challenges for sustainable development.

Forest Carbon and REDD+ in Papua New Guinea

Forests cover approximately 70–80 percent of Papua New Guinea’s land area, making them one of the largest intact tropical rainforest systems in the Asia-Pacific region. These forests act as significant carbon sinks by absorbing and storing carbon dioxide. PNG has been actively engaged in forest carbon initiatives, especially through REDD+ (Reducing Emissions from Deforestation and Forest Degradation), a mechanism under the UN Framework Convention on Climate Change.

Through REDD+ and voluntary carbon markets, PNG can generate carbon credits by preventing deforestation, improving forest management, and enhancing forest carbon stocks. These credits can be traded internationally, providing revenue streams that support conservation, community livelihoods, and national development. However, challenges remain, including land tenure complexity, governance issues, and ensuring that benefits reach customary landowners, who own over 95 percent of the land in PNG.

Biodiversity and Nature-Based Carbon Markets

Papua New Guinea is one of the most biodiverse countries on Earth, hosting thousands of plant species, many of which are endemic, as well as unique wildlife such as birds of paradise and tree kangaroos. Increasingly, carbon markets are recognizing the co-benefits of biodiversity conservation. High-integrity carbon projects in PNG can be designed to protect biodiversity alongside carbon sequestration, enhancing their value in premium markets.

Biodiversity-linked carbon credits emphasize ecosystem integrity, habitat protection, and resilience. In PNG, protecting intact forests not only stores carbon but also safeguards watersheds, cultural values, and food security for local communities. Integrating biodiversity safeguards into carbon trade can strengthen PNG’s environmental stewardship while attracting environmentally conscious investors.

Blue Carbon: Mangroves, Seagrass, and Coastal Ecosystems

PNG’s extensive coastline and island geography support vast mangrove forests, seagrass meadows, and coral reef systems. These coastal ecosystems store large amounts of carbon in sediments and biomass, known as blue carbon. Mangroves, in particular, can sequester carbon at rates far higher than terrestrial forests and store it for centuries.

Blue carbon initiatives in PNG hold significant potential for carbon trading while delivering coastal protection, fisheries support, and climate adaptation benefits. Protecting and restoring mangroves can reduce emissions from degradation while enhancing resilience against sea-level rise and storm surges. However, blue carbon markets are still emerging, and PNG requires robust scientific data, monitoring systems, and policy frameworks to fully participate in these markets.

Grey Carbon and Human-Modified Landscapes

Grey carbon generally refers to carbon emissions and sequestration associated with human-made or heavily modified systems, such as urban areas, infrastructure, and degraded lands. In the context of PNG, grey carbon discussions often focus on emissions from mining, logging infrastructure, and urban expansion, as well as the potential to offset these emissions through rehabilitation and sustainable land-use practices.

Reforestation of degraded lands, improved agricultural practices, and restoration of mined areas can contribute to carbon sequestration while reducing net emissions. Integrating grey carbon considerations into national carbon accounting encourages more holistic climate strategies that link development with emissions reduction.

Opportunities and Challenges

The carbon trade offers PNG a pathway to align environmental conservation with economic development. Revenue from carbon credits can support education, healthcare, infrastructure, and community-based resource management. At the same time, risks such as carbon market volatility, weak regulation, and inequitable benefit-sharing must be carefully managed.

Strong governance, transparent carbon accounting, respect for customary land rights, and community participation are essential for the success of carbon trade initiatives in PNG. By balancing economic interests with ecological integrity, Papua New Guinea can position itself as a global leader in nature-based climate solutions.

Conclusion

Papua New Guinea’s forests, biodiversity, coastal ecosystems, and land-use systems place it at the forefront of carbon trade opportunities. Forest and biodiversity carbon, blue carbon, and emerging grey carbon approaches together offer a comprehensive framework for climate mitigation and sustainable development. With appropriate policies, scientific rigor, and inclusive governance, PNG can harness its natural capital to contribute meaningfully to global climate goals while securing long-term benefits for its people.