Developed countries and economies in transition agreed to reduce their greenhouse gas emissions by an average of 5.2 percent from their 1990 levels during 2008-2012.
The sources are of the view that among other things, the Protocol establishes the CDM, a new financial instrument under which a project in a developing country that reduces greenhouse gas emissions, relative to a baseline, generates emission reductions. The project owner could then sell the emission reduction "credits," once they are certified, to an interested buyer, which might include an industrialised country or a specific industry.
The sources said that ADB's CDM facility, announced in September 2003, therefore assists developing countries and project developers in overcoming barriers related to the CDM. It provides technical and administrative assistance, and shoulders up-front costs of the CDM due-diligence and regulatory requirements, until a transaction was successful, they added.
According to these sources, Asia has become the hot spot for potential CDM projects in the past two years and the potential for greenhouse gas mitigation projects among member developing countries looks very promising. The ADB would strive to channel more funds and capacity development assistance to its member countries, enabling them to realise the new opportunities afforded by the Kyoto Protocol and other carbon markets.
The ADB would channel funds from the Kyoto Protocol's Adaptation Fund to help developing countries cope with the negative effects of climate change. As Asia's development partner, the Bank would strive to mainstream climate change adaptation in their development strategies and projects.