Tropical wetlands have been shown to exhibit high rates of net primary productivity and may therefore play an important role in global climate change mitigation through carbon assimilation and sequestration. Many permanently flooded areas of tropical East Africa are dominated by the highly productive C4 emergent macrophyte sedge, Cyperus papyrus L. (papyrus). However, increasing population densities around wetland margins in East Africa are reducing the extent of papyrus coverage due to the planting of subsistence crops such as Colocasia esculenta (cocoyam). In this paper, we assess the impact of this land use change on the carbon cycle and in particular the impacts of land conversion on net ecosystem carbon dioxide exchange. Eddy covariance techniques were used, on a campaign basis, to measure fluxes of carbon dioxide over both papyrus and cocoyam dominated wetlands located on the Ugandan shore of Lake Victoria. Peak rates of net photosynthetic CO2 assimilation, derived from monthly diurnal averages of net ecosystem exchange, of 28–35 μmol CO2 m−2 s−1 and 15–20 μmol CO2 m−2 s−1 were recorded in the papyrus and cocoyam wetlands, respectively, whereas night-time respiratory losses ranged between 10 and 15 μmol CO2 m−2 s−1 at the papyrus wetland and 5–10 μmol CO2 m−2 s−1 at the cocoyam site. The integration of the flux data suggests that papyrus wetlands have the potential to act as a sink for significant amounts of carbon, in the region of 10 t C ha−1 yr−1. The cocoyam vegetation assimilated ~7 t C ha−1 yr−1 but when carbon exports from crop biomass removal were accounted for these wetlands represent a significant net loss of carbon of similar magnitude. The development of sustainable wetland management strategies are therefore required to promote the dual wetland function of crop production and the mitigation of greenhouse gas emissions especially under future climate change scenarios.