China partners with Brazil & EU to launch global carbon market coalition

China has teamed up with Brazil and the European Union to launch a new international coalition aimed at standardising and linking carbon markets across the globe.

Announced on 7 November by Brazilian President Luiz Inacio Lula da Silva at a world leaders’ summit in Belem, the "Open Coalition on Compliance Carbon Markets" seeks to build a unified framework for carbon pricing and emissions trading.

President Lula said carbon markets have the potential to become major revenue streams for countries committed to climate goals—but global alignment is key. “They will only gain scale if countries move towards common parameters,” he noted, highlighting ongoing challenges in financing, rule-setting, and the role of multilateral banks.

European Commission President Ursula von der Leyen described carbon pricing as an essential tool for reducing greenhouse gas emissions. "We want to work closely with Brazil and many like-minded partners on putting a price on carbon. The key to success is to do it right and to do it together," she said, urging other nations to adopt domestic trading systems and join the coalition.

The coalition’s focus is to boost transparency, fairness, and efficiency in compliance carbon markets, which are already in place in more than 50 countries and cover about 30% of global emissions, according to the World Bank.

Brazil recently established a secretariat to oversee its emerging carbon market, following legislation passed last December. The announcement comes just days before COP30 kicks off in Belem on 10 November, where climate finance and carbon pricing are expected to take center stage.