A letter of intent for cooperation on environmental issues was signed by Japan Minister of the Environment Nobuteru Ishihara and ADB president Takehiko Nakao.

Both the parties will cooperate for effective implementation of the Japan Fund for the Joint Crediting Mechanism (JFJCM).

The JCM is a bilateral carbon market mechanism between the Japanese government and developing countries to promote greenhouse gas emissions reduction projects.

As per the plans, only countries that have signed a memorandum of understanding for a bilateral-offsets program with Japan will be eligible.

Eight countries including Bangladesh, Cambodia, Indonesia, Lao People’s Democratic Republic, Maldives, Mongolia, Palau, and Viet Nam have signed the agreement.

The ADB said more countries are likely to join the JFJCM, which will provide grant finance the adoption of advanced low-carbon technologies like smart grids, waste-to-energy schemes, and energy efficiency measures.

Nakao said the establishment of the JFJCM is an important step to help meet the demands of the Asia and Pacific region for sustainable low-carbon infrastructure.

"The fund will provide grant finance to reduce the cost of advanced low-carbon technologies, such as those related to waste-to-energy schemes and smart grids, which often have initial high investment costs and long cost recovery periods," Nakao added.

Japan and the ADB will also collaborate in air quality management, strengthening enforcement of environment laws, and responding to climate change.

Image: Japan Minister of Environment Nobuteru Ishihara and President Nakao. Photo: Courtesy of Asian Development Bank.