TOKYO >> This summer, the government is planning to launch the first agricultural-­sector emission trading project under its bilateral trading mechanism. The project will see Japan providing the Philippines and Vietnam with technology to reduce greenhouse gas emissions in exchange for credits for the emissions that are cut.

The project will be the world’s first such bilateral trade plan involving agriculture that’s meant to reduce methane gas emissions, a large producer of greenhouse gases, while encouraging Japanese companies to expand their overseas operations and take the lead in the market for agricultural decarbonization.

The project will be conducted via the Joint Crediting Mechanism, referred to as JCM, that was introduced by Japan in 2013, in which some greenhouse gas emission reductions achieved through the sharing of technology benefit Japan. Those reductions are issued as “credits.” So far, Japan has signed JCM partnerships with 29 countries, including the Philippines and Vietnam. So far, most of the transactions have been in the energy sector. None have been agricultural.

According to the Agriculture, Forestry and Fisheries Ministry, Japanese companies such as the large agricultural machinery maker Kubota Corp. are expected to participate in the project.

Here’s how it works: Japan will provide the Philippines and Vietnam with intermittent irrigation, which involves repeatedly flooding and drying rice paddies; in exchange, it will receive some of the credits earned by the reduction of emissions. The credits will be sold to domestic and foreign companies involved in decarbonization efforts. Part of the proceeds from the sales of the credits will be returned to local farmers.

Rice paddies are responsible for 48% of the world’s greenhouse gas emissions generated from agricultural land. Of those greenhouse gases, 94% is methane, which traps 25 times as much atmospheric heat as carbon dioxide. In Asia, which accounts for 90% of global rice production, reducing methane from paddies is a major ongoing challenge. Intermittent irrigation is a method of drying rice paddies by frequently removing water while rice plants are growing. This method is designed to suppress methane-producing bacteria in the soil. In an experiment in Vietnamese paddies, emissions per unit area were reduced by about 40% and rice production increased by about 20%.

The government and other entities estimate that the annual amount of greenhouse gas emissions that can be cut in rice paddies will total about 3.2 million tons in the Philippines and 14 million tons in Vietnam. The market value of the combined credits is estimated at about 20 billion yen (about $126.4 million).

By fiscal 2030, Japan aims to reduce greenhouse gases to 46% below the fiscal 2013 level, and to achieve carbon neutrality — a state in which greenhouse gas emissions have been reduced to virtually zero — by 2050. Toward those goals, it intends to extend agricultural bilateral trading to more Asian countries.

Another major agricultural source of methane globally is cow belching, which generates four times the emissions of rice paddies. In Japan, research is ongoing to reduce methane emissions from cow belching. Related technology is expected to be shared with other countries through the JCM.