The 2025 Announcement Structure: Government Blueprint for Carbon Market Entry
MOTIE Public Notice No. 2025-215 announces the 2025 open solicitation for the International Greenhouse Gas Reduction Project. The essence of this announcement is the government's effort to identify — from the private sector — candidate projects capable of generating overseas greenhouse gas reduction outcomes that can be applied toward Korea's Nationally Determined Contribution (NDC) targets. The mechanism is the acquisition of Internationally Transferred Mitigation Outcomes (ITMOs) under Paris Agreement Article 6.2 — this is fundamentally different in character from standard ESG subsidies.
The announcement provides feasibility study (F/S) support with a total budget of approximately 7 billion KRW, accepting applications on a rolling basis from March 5, 2025 until the budget is exhausted. Evaluation is conducted in four annual rounds, allowing companies to submit at the optimal point for their project's preparation level. All Paris Agreement Parties are eligible as target countries — Bangladesh is naturally included.
The ITMO Mechanism and Project Structure
Understanding this announcement properly requires understanding how ITMOs work. ITMOs (Internationally Transferred Mitigation Outcomes) are a bilateral mitigation result transfer mechanism established under Paris Agreement Article 6.2. When a Korean company reduces greenhouse gas emissions in Bangladesh, those reductions — following authorization (authorization) by the Bangladeshi government — can be transferred and counted toward Korea's NDC achievement.
The critical technical requirement in this structure is the corresponding adjustment. Bangladesh must remove the relevant reduction from its own national emissions inventory, while Korea counts it in its own tally — the double-counting prevention procedure must actually function. This is why the feasibility studies required under the 2025 announcement must verify not only the quantum of reductions achievable, but also whether the target country government has the willingness to issue authorization and make corresponding adjustments.
Why Bangladesh is a Strong Target Country Candidate
When selecting a target country from among Paris Agreement Parties, companies must consider three primary factors. First, is there an industrial base with significant greenhouse gas reduction potential? Second, can Korean technology and equipment compete effectively? Third, do cooperation channels with the local government already exist? Bangladesh is one of very few countries that simultaneously satisfies all three conditions.
| Sector | Reduction Mechanism | Estimated Reduction Scale | Implementation Difficulty | Priority Targets |
|---|---|---|---|---|
| RMG factory energy efficiency | Electricity and steam consumption reduction | 500–2,000 tCO2e/factory/year | Medium | Garment-dense industrial zones (EPZ, SEZ) |
| Industrial boiler replacement | Fossil fuel consumption reduction | 300–1,500 tCO2e/boiler/year | Low | Large dyeing and finishing factories |
| Rooftop solar generation | Grid power displacement | 1,000–1,400 tCO2e/MW/year | Medium | Factory and warehouse rooftops |
| Wastewater biogas recovery | Methane capture and energy recovery | 2,000–5,000 tCO2e/facility/year | High | Dhaka-Chittagong industrial wastewater |
| Brick kiln technology conversion | Coal combustion reduction | 1,000–3,000 tCO2e/kiln/year | High | Traditional brick industry concentration areas |
Application Strategy: 5 Principles for Maximizing Selection Probability
The 2025 announcement's rolling application structure might suggest that early submission is advantageous — but since evaluation proceeds in rounds, preparation quality matters more than submission timing. According to the operating guidelines, the evaluation committee assesses economic, technical, and legal feasibility alongside the project's public benefit, the realism of the reduction estimates, and the viability of the pathway to subsequent full project implementation. Applications must therefore be prepared not simply to fill in a form, but to build structural persuasiveness around the project.
Risk Factors and Mitigation Approaches
International GHG reduction projects carry more structural risk than standard export support programs. The ITMO mechanism is still not fully standardized at the global level, so companies must explicitly acknowledge and prepare for institutional uncertainty. Key risks to watch for when targeting Bangladesh, and the corresponding mitigation approaches, are as follows.
| Risk Type | Specific Content | Likelihood | Mitigation Approach |
|---|---|---|---|
| Authorization delay | Target country government ITMO approval procedure delayed or opaque | High | Pre-emptive informal consultation and ODA channel utilization |
| Data insufficiency | Local energy consumption data needed for reduction quantification is unavailable | Medium | Execute MOU with local partner for data provision commitment |
| Regulatory change | Sudden shifts in Bangladesh energy and environmental regulations | Medium | Design multiple scenarios and establish periodic monitoring |
| Exchange rate volatility | Project cost fluctuations due to Bangladeshi Taka (BDT) value changes | High | Incorporate exchange rate range into project cost calculations |
| Technical compatibility | Korean equipment incompatible with local climate and power conditions | Low | Adjust specifications based on local empirical data |
Practical Checklist: Participation Decision and Preparation Sequence
To move beyond simply reading the 2025 announcement to actually participating, companies must systematically assess their own capabilities and project candidates. The following checklist summarizes the practical decision process from announcement analysis to submission decision.
In summary, the 2025 International GHG Reduction Project announcement is a concrete policy signal that the Korean government is prepared to back private sector participation in overseas carbon markets. More important than the 7 billion KRW budget figure is the fact that the ITMO portfolio built through this program can become a core asset in Korea's future carbon market. Bangladesh satisfies all three prerequisite conditions — manufacturing-sector reduction potential, suitability of Korean technology, and existing cooperation channels — making it an appropriate first-priority target country for consideration. The most realistic approach is to initiate preliminary discussions with the KOTRA Dhaka Trade Office, pursue local partner identification and data collection in parallel, and develop a round-specific submission strategy aligned to the evaluation schedule.