TOKYO, Aug 7 (Reuters Point Carbon) - Japan signed an agreement with Laos on Wednesday to launch a scheme that will allow Japanese companies to earn cheap carbon credits by helping the Southeast Asian nation cut carbon dioxide (CO2) emissions, the Japanese government announced.
The agreement was signed in Laos by Junko Yokota, the Japanese ambassador to Laos, and Noulinh Sinbandhit, Laos’ natural resources and environment minister.
Under the agreement, the two countries will set up a joint committee of representatives to operate a bilateral carbon offset credit mechanism, formally called the Joint Crediting Mechanism (JCM).
Japan has been pushing for the bilateral offset credit mechanism in the past few years, claiming that the proposed scheme will appropriately evaluate contributions Japanese firms make to curbing CO2 and other greenhouse gas (GHG) emissions abroad by providing clean technologies, products, infrastructure and manufacturing facilities.
The new carbon credit mechanism will be different from the existing Clean Development Mechanism (CDM) under the Kyoto protocol, which requires applicant companies to go through a lengthy screening process controlled by the United Nations.
Under the new carbon credit mechanism proposed by Japan, such a U.N. process will be bypassed, as all necessary arrangements are made under bilateral pacts between governments concerned alone.
Laos becomes the seventh country to sign such a bilateral pact with Japan, after Mongolia, Bangladesh, Ethiopia, Kenya, the Maldives and Vietnam.
Japan is seeking to conclude similar bilateral pacts with other developing countries such as Indonesia and India.