• Climate change has led to increased production risks especially for smallholder farmers who often tend to be more vulnerable
• Sub-Saharan Africa (SSA) has several climate change hotspots and is more vulnerable to weather shocks compared to other regions.
• >363 million people affected by drought between 1980-2014 causing > US$31 billion in losses – with 19 billion in East Africa (FAO, 2015)
• Agricultural insurance is a risk management tool for extreme weather events; however, its coverage remains lowest in SSA (Hess and Hazell, 2016).

This document presents the results of the financial evaluation of the potential of carbon markets for cocoa production systems in the departments of Caquetá and Cesar on small producer farms. The economic benefits were evaluated from the potential of carbon capture from the implementation of Cocoa agroforestry systems and the containment of the expansion of natural forest areas for the REDD initiative.