What is the CDM?

A CDM project is a development project, driven by market forces, that reduces GHGs.

In a CDM project, an investor from an industrialised country supplies capital or

technology, based on the future value of certified emission reduction units (CERs), also

known as carbon credits, which measure the reduction of GHGs in the developing

country.

Under the CDM all parties benefit – the host country is assisted in achieving sustainable

development, the owner of the project receives financial and technological assistance,

and the emitter in the industrialised country receives carbon credits.

The basic requirements of a CDM project are therefore twofold: it has to meet certain

measurable environmental criteria, and it has to fit in with the host country’s

development priorities. The host country benefits from positive environmental

improvements like reduced air and water pollution and less land degradation, and from

social improvements like the creation of new jobs.