On May 29, 2025, Acting Minister of Economy and Finance Kim Beomseok, signed a contribution agreement with Deputy Executive Secretary of the United Nations Framework Convention on Climate Change (UNFCCC) Noura Hamladji, on behalf of the Executive Secretary, and a memorandum of understanding (MOU) with Director General of the Global Green Growth Institute (GGGI) Kim Sang-Hyup, respectively, to facilitate cooperation in developing the Global Voluntary Carbon Market Aligned with the Paris Agreement (GVCM) at the Government Complex-Seoul. GVCM is a new Article 6 aligned carbon market model aimed at fostering international carbon credit trading with enhanced credibility by addressing the challenges of existing voluntary carbon markets.
The Ministry of Economy and Finance (MOEF) and the UNFCCC secretariat signed a statement of intent (SOI) to collaborate on establishing an internationally accepted Global Voluntary Carbon Market model that aligns with Article 6 of the Paris Agreement on November 28, 2024. As a follow-up to the successful SOI, MOEF signed an agreement and an MOU with its partners to outline individual frameworks for collaboration.
1. Summary of the contribution agreement between MOEF and the UNFCCC secretariat
By signing the agreement, MOEF and the UNFCC secretariat agreed to cooperate in developing a transparent and credible Global Voluntary Carbon Market model, in alignment with Article 6 of the Paris Agreement, particularly the Paris Agreement Crediting Mechanism (PACM). Key areas of collaboration include developing credit issuance methodologies, facilitating international credit trading, building capacity in developing countries, and exploring ways to leverage private sector investment.
Unlike the traditional bilateral approach that requires country-specific rules and has some possibilities to result in administrative inefficiencies, the GVCM will be designed to support multi-country participation, enhancing operational efficiency.
In addition, developing pilot projects pipeline and capacity building programmes will be provided to support the participation of developing countries in carbon markets.
2. Summary of the MOU between MOEF and GGGI
By signing an MOU, MOEF and GGGI agreed to cooperate in operating the GVCM. GGGI will provide support to review various methodologies, MRV programmes, manage registration of mitigation projects, issue carbon credits, implement pilot projects, strengthen the capability of market participants, and oversee the integrity and credibility of projects.
In addition to GVCM-related collaboration, MOEF and GGGI agreed to develop initiatives in green growth and climate finance, and to promote the application of Korean technologies and policies to help GGGI member countries achieve low-carbon and climate-resilient development.
Through the signing of the agreement and the MOU, MOEF will partner with the UNFCCC secretariat and GGGI to develop a highly credible and efficient GVCM by 2028. MOEF also plans to explore opportunities for greater participation of Korean companies in the global carbon market through the GVCM.
Please refer to the attached files.
