Paraguay prepares to approve national carbon strategy and reviews four early Article 6 projects
By Article 6 Network
Paraguay is close to approving its National Carbon Markets Strategy. It is also considering a multi-stage vetting process for Article 6 projects and is examining four early-stage Paris-aligned projects, the country’s carbon markets lead told Carbon Pulse. These steps would move Paraguay from building its legal framework to running a project pipeline.
Paraguay’s carbon markets lead told Carbon Pulse that the government is weighing approval of a multi-stage process for vetting Article 6 projects and is reviewing four early-stage projects intended for Paris-aligned transactions. The country is also preparing to approve its national carbon strategy.
Paraguay has built its framework steadily. Law 7190 of 2023 set out the legal basis for carbon credit trading. Implementing regulations approved in February 2025 created a Carbon Markets Directorate within the Ministry of Environment and Sustainable Development (MADES) and launched a national Carbon Credit Registry. The regulations require between 3% and 10% of ITMOs issued by Article 6 projects to stay in the country and set registration fees for both Article 6 and voluntary projects. The Global Green Growth Institute is supporting the work through its Carbon Transaction Facility, including developing the National Carbon Markets Strategy.
Earlier this year, Paraguay created a National Cadastre of Mitigation Projects and tendered for consultants to draft the national strategy and an Article 6 operational manual. Officials said Paraguay is choosing between ART TREES and Verra’s Jurisdictional and Nested REDD+ framework as its national approach to J-REDD+. The country’s president has made carbon markets state policy, with Article 6 a priority. Singapore has already bought nature-based credits from a project in Paraguay.
Signals to watch
- From law to pipeline: A formal vetting process and four candidate projects show Paraguay is moving from legislation to delivering projects. Developers should look out for the published criteria, timelines and fee structure for each stage of approval.
- Retention rule shapes economics: Paraguay’s requirement to keep 3–10% of ITMOs, plus registration fees, directly reduces the volume available to sell. Investors should build both into their project economics and compare them with other Latin American hosts.
- J-REDD+ decision is pivotal: Choosing between ART TREES and Verra JNR will shape how forest projects in the Atlantic Forest and Chaco biomes connect to jurisdictional accounting. This matters for both CORSIA eligibility and sovereign buyers.
- Buyer engagement broadening: Paraguay already has a link with Singapore and is talking to major buyer countries. Watch for implementation of existing agreements and possible new ones with Switzerland, Japan, Sweden, Norway or South Korea.
- Unusual additionality definition: Paraguay’s 2025 regulation defines additionality by whether emissions would have occurred without the project, not by financial need. Buyers using stricter international additionality tests may apply extra scrutiny. Developers should be ready to meet both standards.
Sources:
- GGGI – Paraguay accelerates the implementation of its carbon market
- Carbon Pulse – Paraguay’s new regulations integrate voluntary carbon into Article 6
- Carbon Pulse – Paraguay’s carbon project cadastre kicks Article 6 ambitions into high gear
- Carbon Pulse – Article 6 coverage including Paraguay president’s remarks
