Comprehensive Guide to GHG International Reduction Projects via KOTRA: KRW 7 Billion Support and Practical Procedures
KOTRA's Role in GHG International Reduction Projects
GHG international reduction projects are policy programs where Korean companies pursue greenhouse gas reduction projects overseas and utilize the results toward Korea's NDC achievement under Paris Agreement Article 6. While the Ministry of Environment (MOE) designs the framework and executes budgets, the key agency performing actual project discovery, company linkage, and local partner matching on the ground is KOTRA.
KOTRA possesses a network of 129 overseas trade offices across 84 countries, capable of identifying reduction project candidates in Paris Agreement party countries and facilitating contact with local governments and businesses. The Dhaka Trade Office in particular conducts local partner exploration and consultation for Korean companies' international reduction project entry, leveraging Bangladesh's high carbon intensity in energy and industrial sectors. As of 2026, MOE has allocated KRW 7 billion as a dedicated budget for international reduction projects, substantially strengthening participation incentives for companies.
KRW 7B
MOE Support Budget
2026 dedicated fund
129
KOTRA Trade Offices
84-country network
195 countries
Paris Agreement Parties
Eligible partner nations
Up to 70%
Project Cost Support
F/S basis
ITMO
Credit Standard
Article 6.2 unit
22%
Bangladesh NDC Target
2030 reduction goal
KRW 7 Billion Fund Structure and Support Types
The KRW 7 billion budget allocated by MOE is classified into three support types. KOTRA discovers project candidates for each type through its trade office network and provides consulting to help companies prepare applications aligned with the appropriate support category.
Step-by-Step Application Process via KOTRA Channel
While the international reduction program is structured with MOE issuing notices and companies applying directly, completing preparations through KOTRA trade offices significantly increases application success rates. The following describes the six-step process maximizing KOTRA channel utilization.
International Reduction Project Application Process via KOTRA Channel
Step 1: Trade Office Contact
Submit expression of interest to target country trade office
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Step 2: Local Opportunity Screening
KOTRA screens local reduction potential and partners
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Step 3: Notice Review & Application
Submit via MOE KOAS system
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Step 4: Feasibility Study Execution
Using grant funding with KOTRA local cooperation
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Step 5: Partner Government Approval
MOU/agreement, partner country MOE approval
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Step 6: MRV Registration & ITMO Issuance
Credit registration, NDC achievement attribution
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Step 1 -- KOTRA Trade Office Pre-Contact
Korean companies interested in the program contact the KOTRA trade office in their target country to communicate their "international reduction project participation intent." For Bangladesh, this is the Dhaka Trade Office (dhaka@kotra.or.kr); for Vietnam, the Ho Chi Minh/Hanoi offices; for Indonesia, the Jakarta office. The trade office reviews the country's NDC reduction targets, renewable energy and energy efficiency project conditions, and government contact feasibility (e.g., Bangladesh MoEFCC) and provides feedback.
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Step 2 -- Local Opportunity Screening and Partner Matching
KOTRA trade office local opportunity screening reports include: (1) reduction potential sectors (solar, high-efficiency boilers, methane capture, etc.), (2) local partner candidates, (3) regulatory environment and expected permitting timelines, and (4) preliminary business viability assessment. At this stage, formally requesting partner matching through KOTRA's GP (Global Partnership) platform enables the trade office to arrange initial meetings.
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Step 3 -- MOE KOAS Notice Application
MOE's Climate Change International Cooperation Division posts international reduction project notices on KOAS (Korea Offset Accounting System) 1-2 times annually. Applications require: (1) project overview and reduction methodology, (2) host country government cooperation letter (obtained via KOTRA trade office), (3) local partner confirmation, and (4) budget plan (government funding vs. company co-payment). Securing host government letters in advance through KOTRA is advantageous for evaluation scores.
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Step 4 -- Feasibility Study (F/S) Execution
Once approved, F/S is conducted with up to KRW 300 million (government 70%, company 30%). KOTRA trade offices support local investigation scheduling, government agency meetings, and local consulting firm introductions. The F/S report includes reduction volume estimates, MRV methodology design, host government acceptance assessment, and project profitability (including credit sales revenue).
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Step 5 -- Partner Government Approval and Agreement
Under Paris Agreement Article 6.2, ITMOs from international reduction projects require an official Letter of Authorization from the partner government. KOTRA trade offices open official consultation channels with local environment/climate ministries to support Korean companies through the authorization process. In Bangladesh, MoEFCC (Ministry of Environment, Forest and Climate Change) is the authorization lead ministry.
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Step 6 -- MRV Registration and ITMO Credit Issuance
Once the project is approved and operational, MRV agencies verify annual reduction volumes, which are registered as ITMOs in KOAS. Registered credits can be utilized through three pathways: (1) submitted as Korean government NDC compliance (primary use), (2) used for corporate voluntary carbon neutrality declarations, or (3) used as offset credits under K-ETS when domestic ETS linkage is established.
Bangladesh Carbon Market Entry Points and Reduction Opportunities
Bangladesh, as a Paris Agreement party, has committed to reducing GHG emissions by 15% through domestic efforts and 22% with international support versus BAU by 2030. With over 50% of energy demand dependent on fossil fuels, substantial international reduction project potential exists in renewable energy transition and industrial energy efficiency. Key reduction sectors accessible through the KOTRA Dhaka Trade Office channel are outlined below.
Bangladesh Key International Reduction Project Candidate Sectors
Reduction Sector
Annual Potential
Methodology
Key Local Partners
Korean Company Strengths
Solar Power
5-10M tCO2/yr
AMS-I.A (small-scale)
SREDA, private IPPs
Module/inverter supply, EPC
Industrial Energy Efficiency
2-4M tCO2/yr
AMS-II.B
BGMEA factory clusters
High-efficiency boilers, inverters
Biogas (Livestock/Food)
0.5-1M tCO2/yr
AMS-III.R
Agri-food companies
Anaerobic digestion technology
Clean Cooking Fuel
1-2M tCO2/yr
AMS-II.G
NGOs, rural dev agencies
LPG and electric cookstove distribution
Landfill Gas Capture
0.3-0.8M tCO2/yr
ACM0001
Dhaka South CC
Landfill gas power systems
High-Efficiency HVAC
0.5-1M tCO2/yr
AMS-II.F
RMG factories, hospitals
Inverter AC, heat pumps
The KOTRA Dhaka Trade Office maintains regular cooperation with Bangladesh's SREDA (Sustainable and Renewable Energy Development Authority). Korean companies interested in international reduction projects can request official meetings with SREDA through the trade office and receive real-time information on Bangladesh government renewable energy solicitations. Hybrid financing structures linking BCCTF (Bangladesh Climate Change Trust Fund) and GCF (Green Climate Fund) co-financing are also possible, further reducing initial financial burden.
Paris Agreement Article 6 ITMO Mechanism and Credit Value Utilization
The core output of international reduction projects is the ITMO (Internationally Transferred Mitigation Outcome) issued under Paris Agreement Article 6.2. Companies pursuing projects through KOTRA must understand how ITMO credits are issued and what value they hold.
NDC Compliance ITMOs
EntityAttributed to Korean government
Purpose2030 NDC 40% target achievement
Price BasisGovernment purchase price (negotiated)
Company BenefitsGrants and tax benefits
Corresponding AdjustmentDeducted from partner country NDC
Voluntary Market ITMOs
EntityHeld by issuing company
PurposeCorporate carbon neutrality declaration
Price BasisInternational VCM market rates
Company BenefitsCredit sales revenue
Corresponding AdjustmentApplies under Article 6.4 registration
With Paris Agreement Article 6 detailed rules (6.4 mechanism Supervisory Body) nearing completion, ITMO international trading value is expected to steadily increase. Companies participating early in KOTRA-supported international reduction projects can secure project foundations while credit prices remain low, positioning themselves to realize monetization potential as the carbon market matures.
Eligibility Requirements and Preparation Checklist
To participate in MOE international reduction project notices, basic requirements must be met. Review the items below before engaging KOTRA trade office channels.
International Reduction Project Eligibility and Preparation Checklist
Item
Requirement
How to Fulfill
Notes
Legal Status
Domestically registered corporation
Submit business registration
Sole proprietors ineligible
Financial Soundness
No net losses in last 2 years
Submit financial statements
Some SME exceptions
Local Partner
Host country corporation or institution
Use KOTRA trade office matching
MOU recommended
Reduction Methodology
CDM, Gold Standard, or VCS recognized
Pre-review methodology
KOTRA consulting support
Partner Government Support
Official letter from host ministry
Use KOTRA diplomatic channel
Authorization letter required
Company Co-Payment
F/S 30% / Full project 50%
Prepare funding plan
Policy financing linkage possible
MRV Capability
Reduction measurement and verification plan
Develop during F/S phase
External verification outsourcing possible
Domestic Partner
Research institute/university recommended
Partner with KECO, etc.
Bonus evaluation points
KOTRA Utilization Strategies for Successful Participation
International reduction projects are not simply about receiving government grants. They require complex capabilities including diplomatic cooperation with Paris Agreement parties, carbon MRV technical expertise, and local partnership management. Companies that maximize KOTRA utilization have an advantage in competitive evaluation and can achieve first-mover benefits in credit value realization after project completion.
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Pre-Registration Strategy Before Official Notices
While MOE notices occur only 1-2 times per year, KOTRA trade office local partner exploration operates year-round. Registering interest 6 months before notices allows the trade office to pre-assemble a partner pool, enabling immediate application completion upon notice publication. While competitors search for local partners post-notice, you will have already signed MOUs, creating a significant evaluation score advantage.
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Multi-Country Portfolio Strategy
Rather than focusing on a single country, leverage KOTRA's trade office network to simultaneously submit F/S applications for multiple countries including Bangladesh, Vietnam, Cambodia, and Indonesia. F/S support allows up to KRW 300 million per project with no restrictions on simultaneous multiple applications. Then concentrate full-scale projects on the country showing highest viability.
Bangladesh has power shortages (10-15% peak deficit), abundant solar potential (5kWh/m2/day), and high RMG industrial energy intensity, making it highly suitable for international reduction projects. The KOTRA Dhaka Trade Office maintains close cooperation with SREDA and BERC (Energy Regulatory Commission), accepting Korean company energy project inquiries year-round. Companies registering interest with the Dhaka office receive confidential Bangladesh NDC implementation roadmaps and reduction potential project lists.
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Minimizing Co-Payment Through Policy Financing Linkage
International reduction project co-payments (F/S 30%, full project 50%) can be financed through KEXIM overseas project finance (including EDCF), K-SURE insurance, and GCF co-financing. KOTRA has MOUs with KEXIM and K-SURE, and introductions through trade offices enable faster review processing compared to standard channels.
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ESG and Carbon Neutrality Declaration IR Strategy Linkage
ITMO credits obtained through international reduction projects can serve as evidence for corporate RE100 and carbon neutrality declarations. Korean SMEs seeking global supply chain entry can include international reduction project participation in IR materials as proof of carbon footprint (Scope 3) reduction. KOTRA trade offices also facilitate connecting such ESG marketing to local buyers.
GHG international reduction projects through KOTRA represent strategic investments that go beyond simple government grant programs to secure Korean companies' long-term positions in the Paris Agreement carbon market. Combining MOE's KRW 7 billion budget support with KOTRA's 129 overseas trade office network significantly lowers the entry barrier for SMEs to meaningfully participate in international carbon markets. Bangladesh, with its high carbon intensity and the Dhaka Trade Office's rich local network, is particularly attractive as a first-attempt target country for international reduction projects. Register your interest with the KOTRA trade office now and begin preparations before the next notice is published.