(VOVWORLD) - At the first edition of an innovation program called “Inno Vietnam-Japan Fast Track Pitch 2023”, a subsidiary of leading Vietnamese IT corporation, FPT, raised its challenge on creating a cross-border carbon credit trading and management platform. The idea of FPT IS has captured a particular interest of the program’s winner, Faeger, a Japanese start-up. The two are expected to work together to materialize FPT’s initiative. Let’s find out what are FPT’s challenge and Faeger’s solution and how they match with each other.
 Tran Duc Tri Quang, FPT IS Chief Data Officer (Photo: FPT IS) |
The “Inno Vietnam-Japan Fast Track Pitch 2023” program aims to connect innovation activities of Vietnam and Japan to promote the innovation capacity of Vietnamese enterprises and those in ASEAN to solve the difficulties faced by large tech firms of both countries.
One of the two challenges FPT IS raised is to create a cross-border carbon credit trading and management platform.
Tran Duc Tri Quang, Chief Data Officer of FPT Information System, said there are two main reasons why the company chose this topic.
“First, green transition is an irreversible trend. Second, over the past 50 years Japan has provided a great number of projects in green transformation to Vietnam. As a result, we think that this topic is good for both countries to coordinate and prepare for Vietnam when it plans to pilot the carbon credit exchange from 2025,” said Quang.
According to carboncredit.com, a carbon market allows investors and corporations to trade both carbon credits and carbon offsets simultaneously. This mitigates the environmental crisis, while also creating new market opportunities.
International carbon trading markets have been around since the 1997 Kyoto Protocols, but the emergence of new regional markets have prompted a surge of investment. The global carbon market value was estimated at more than 900 billion USD last year.
Under the challenge, FPT IS wants to have a way to verify carbon credits so that each carbon credit is designated as unique and irreplaceable by using blockchain.
The use of blockchain also helps to reduce costs and increase transparency in carbon credit transactions and management.
When it comes to carbon credits, Quang said it is like a commodity and needs a method to determine whether the commodity is good or not and ultimately how much carbon a project produces. Such ideas are quite new to Vietnam, especially in terms of legal documents and measurement standards.
Meanwhile, Japan has been developing carbon measurement standards for more than 13 years and many of its businesses have taken the initiative in introducing them abroad.
“That’s why we thought it would be good to raise the topic at the Inno Vietnam-Japan Fast Track Pitch,” said Quang, adding, “In fact, there are many standards like Verra Standard or Gold Standard of Europe, which are viable for large countries like the US, Canada, and territories completely located on flat terrain. It is a bit different for Vietnam’s terrain that has lots of hills and mountains. At this point, Vietnam and Japan share greater similarities. So, we think Japan’s standards are suitable to Vietnam.”
 (Photo: FPT IS) |
Faeger, a Japanese start-up which monetizes decarbonization measures for farmers and supports the distribution of carbon credits, was matched with FPT IS’s challenge, Quang told VOV.
“Among the entries, we find two characteristics of Faeger that can very well support not only FPT, but also the Vietnamese people,” the FPT IS chief said and explained in details, “First, Faeger operates in the agricultural sector. Most companies relating to green transformation often target human activities, energy, manufacturing, or transportation rather than agriculture. But Vietnam is an agricultural nation.”
“Second, Faeger has been successful in Myanmar in bringing capital from Japan to Myanmar to build infrastructure, create carbon credits, and divide profits equally between farmers and Japan,” Quang noted.
 Yusuke Takai, Faeger’s COO, presents his solution at the jury board of the “Inno Vietnam-Japan Fast Track Pitch 2023” (Photo: FPT IS) |
Yusuke Takai, Faeger’s COO, told VOV after the award ceremony in Hanoi last Friday about his scheme and how it can support FPT IS’s idea.
“This solution has a great value for the farmers, since they can utilize the investment from the Japanese government, and also can improve their productivity in agriculture, as well as reduce the GHG (greenhouse gas) emissions. So this is the first value for the farmers. Second, for companies like FPT, to develop the carbon credit trading platform, the GHG verification is quite important to consider,” said Yusuke Takai.
He insisted that Faeger’s scheme has a good knowledge, a right knowledge about GHG verification, adding that the solution can support the development of the GHG verification scheme for the platform.
“And also, we can collaborate with farmers in Vietnam. In that case, the FPT connection in Vietnam has a great value for us. That’s why we can collaborate,” Yusuke Takai concluded.
Chief Data Officer of FPT Information System Tran Duc Tri Quang said that FPT IS hopes to start their cooperation with Faeger as soon as possible, focusing on large agricultural businesses first. It’s like creating new standards in farming through which farmers can clearly see the benefits if they follow suit, he said.