The Japan Bank for International Cooperation (JBIC) has signed a cooperation agreement on the Clean Development Mechanism (CDM) with Sri Lanka. The agreement will promote CDM projects in Sri Lanka and will support the acquisition by Japanese firms of greenhouse gas (GHG) emissions reduction credits generated from such projects.


Under the agreement, both parties will exchange information on the Kyoto Mechanisms and the ministry of environment will provide JBIC with information on candidate CDM projects in Sri Lanka. JBIC will provide details for Japan Carbon Finance Ltd and other Japanese firms and will consider financial support for the projects.


JBIC is focusing attention on Sri Lankan CDM projects, especially in the areas of hydropower and biomass energy. Likewise the Sri Lankan government is committed to advancing the CDM. Having already approved three small hydropower CDM projects, the government is currently applying for registration at the CDM executive board.


If Japan is to achieve its GHG emissions reduction target (6% below the 1990 level), it is important to make use of the Kyoto Mechanisms, including the CDM, in addition to domestic efforts to reduce GHG emissions. Through agreements such as this one, JBIC is committed to promoting the Kyoto Mechanisms.