Community MARKETS for Conservation – Markets to Advance Conservation Mission

 WCS Conservation Efforts, WFP Contracts and COMACO leverage one another’s activities and share expenses  Getting Started – Significant Costs Associated with Establishing CTCs  Lundazi: $1.2M+  Mfuwe: $400K+  Conclusions in May 2007  Agro Processing – Necessity of Higher Value Add  Market Development – Existing and New Markets COMACO Business Analysis Performed in May 2007 on Community Trading Centers: Lundazi and Mfuwe

 First Full Year of Consistent Sales with Established Products  Sales Outlets have been developed with supermarket chains (Shoprite & Spara) and NGOs (Peanut Butter & HEPS)  Net Sales of 851,133,010 kwacha  Rice is best selling product in 2007 = 72% of Sales  Development of Soy Based Product line – HEPS (18% of Sales), Yummy Soy  Bottom Line: 2007 resulted in 349,458,678 kwacha operating loss – not inclusive of D&A 2007 COMACO Financial Data – Year End

 Global Warming is happening – The Debate is Over  GHG at highest levels in at least 800,000 years - Study published in journal Nature  Carbon Dioxide levels estimated to be at 380 ppm and increasing  What Does This Mean?  Poorest of Poor Most Vulnerable to Effects of Climate Change  I Didn’t Cause this Mess…  How are WE Going to Fix the Problem?  Adaptation & Mitigation Needed Now!  “Job is not to punish the polluter but to get rid of pollution” -Richard Sandor (CCX Founder) Climate Change Reality

 Challenge or Opportunity? – ‘It Depends’  Incentives for Cleaner Development  Intersect with Development Priorities  Significant Need for Financial, Knowledge and Technology Transfers on Mass Scale (Design, Implementation, Dissemination )  Need for Commercially Viable Emission Reducing Innovations  Know-How to Implement Technology or Knowledge  Favorable Regulation and Policy for all Transfers  Local Capacity is Necessary – Developers, Verifiers, etc Market Mechanisms for Climate Change

 Its All About ‘ADDITIONALITY’  Mandatory 2007 Offset Market: 73% China, 5% Africa  Kyoto Protocol / Voluntary Markets a Work In Progress  US Legislation – Federal or State Approach  Post 2012 Kyoto Negotiations Market ProgramsMarket Size Trading PricesParticipation Requirements Mandatory Carbon Markets (Kyoto Protocol/CDM) Large - $63+ Billion in 2007 Variable – recently $35+US/CER Rigorous approval and verification process Voluntary Carbon Markets Small but growing rapidly Significantly less than Mandatory – recently $6+US/VER Variable/ Less stringent Mandatory vs. Voluntary Markets

Kyoto Protocol Market (Mandatory Market) Offset Credit Creation Process

COMACO and Climate Change  Opportunity Exists for Smallholder through Co-Benefit Projects  Project Must Include Measurable & ADDITIONAL Steps to Generate Emission Reductions  Must be Verifiable and Monitored  Fiscal Management  Applicability of COMACO’s Model & Infrastructure  Ability to Provide Technology, Knowledge, Innovation Transfer  Organization of Producer Groups can be Leveraged to Generate Credits & Disburse Payments  Tie to COMACO Compliance Activities – Project Development & On-Going Monitoring

COMACO and Climate Change  November Research Identified COMACO Opportunity for Accessing Carbon Markets (Triple Benefit)  Develop coordinated reforestation with agro-forestry project through COMACO producer groups – basis will be hectares of reforested land  Soil carbon capture opportunities through conservation farming of individual COMACO farmers – basis will be acres under CF  Potential for Production Fuel Switching (Small Scale), Electric Fences, biogas, Off-Grid Renewable Energy

 Adaptation: Improved Seed Stock, Soil Carbon Management, Irrigation, Watersheds, Migration, Energy, ‘Coping Strategies’  Ownership Rights – Who Owns Stream of Carbon Credits  Implementation and Sustainability of SANREM Research  Technology & Knowledge Transfers  Financial Incentives  Pilots for Promising Technology  “So What, Then What” – Use Science and Technology Researched by SANREM to Generate Scalable Co-Benefit Methodologies for Emission and Poverty Reduction Climate Change and SANREM Research

COMACO and Markets Questions? Contact: John Fay Emerging Markets Group Tel: