Old Ghost, New Shadows: Resource Curse Dynamics and the Growing Illicit Flows in Africa’s Carbon Market

Abstract

This essay explores the emerging threat of illicit financial flows (IFFs) within Africa’s expanding carbon market, drawing parallels to the historical “resource curse” seen in mining and oil. It illuminates how fraudulent project baselines, inflated offsets, and opaque shell companies allow foreign and domestic actors to exploit the continent's environmental assets for illicit gain. The essay adopts Polanyi’s theory of fictitious commodities and Akerlof’s information asymmetry to explain how market failures and a lack of transparency enable "carbon colonialism" and corruption. Detailed case studies from Zimbabwe, Kenya, and Liberia illustrate the socioeconomic harms caused, including land-grabbing and the displacement of local communities. To combat these systemic vulnerabilities, the author proposes a multi-level policy framework involving international oversight, blockchain-enabled registries, and robust community-led benefit-sharing. Finally, the essay advocates for structural reforms and regional cooperation to ensure Africa’s climate finance contributes to genuine ecological sustainability rather than further financial exploitation.