Soramitsu CBDC and Ryobi Systems Selected for Tokyo Metropolitan Government’s “Global South GX Promotion Project”

Soramitsu CBDC Co., Ltd. (“Soramitsu CBDC”) and Ryobi Systems Co., Ltd. (“Ryobi Systems”) are pleased to announce that their project, “Feasibility Study and Demonstration Project for Decarbonization through the Expansion of AWD Farming in Bangladesh and an Environmental Value Return Model Using Digital Currency,” has been selected for the Tokyo Metropolitan Government’s Global South GX Promotion Project.

Soramitsu CBDC will serve as the lead applicant, with Ryobi Systems participating as a joint applicant.

Ryobi Systems has been conducting demonstration activities for Alternate Wetting and Drying (“AWD”) farming in Bangladesh since 2025. Through these efforts, the company confirmed productivity improvements of more than 20% and methane emissions reductions of approximately 30%. Ryobi Systems continues to promote the wider adoption of AWD farming as a means of reducing greenhouse gas emissions from rice cultivation in Bangladesh.

As the project has progressed, several key challenges have become clear: improving the efficiency and accuracy of water management, reducing the burden of measuring, reporting, and verifying emissions reductions, and maintaining incentives for farmers to continue participating. This new project will address these challenges by advancing water management, reducing the burden of MRV, and developing a mechanism to return environmental value to farmers through digital currency.

Background

Bangladesh is one of the world’s leading rice-producing countries, with agriculture serving as a major industry. However, the country continues to face challenges in improving productivity and stabilizing farmer income due to constraints such as limited access to advanced agricultural technologies, financial limitations among farmers, and insufficient support for farming guidance and agricultural machinery.

AWD farming is a water management technique in which rice fields alternate between flooded and non-flooded conditions. In addition to saving water and improving yields, AWD is expected to reduce methane emissions from soil, making it an effective approach for reducing greenhouse gas emissions in rice cultivation.

Through Ryobi Systems’ AWD demonstration activities in Bangladesh, which began in 2025, several requirements for wider adoption have been identified. These include labor-saving and more accurate water management, efficient methods for understanding and verifying emissions reductions, and the design of economic incentives that encourage farmers to participate on a sustained basis.

In particular, it is important to establish water management methods that both reduce labor and improve accuracy, develop emissions-reduction calculation methods that do not depend solely on direct gas measurement, and create a mechanism that appropriately returns environmental value to participating farmers.

Soramitsu CBDC’s vision is to promote GX and DX through digital technology and to help solve social challenges. The company has pursued projects in six countries overseas, including Cambodia, Laos, Pakistan, the Solomon Islands, Papua New Guinea, and Palau, in cooperation with Japanese government bodies such as the Cabinet Secretariat, the Ministry of Economy, Trade and Industry, and the Ministry of Finance. These initiatives have been aligned with policy priorities including GX/DX, geopolitical challenges, and economic security. Soramitsu CBDC’s advanced technology and implementation track record across multiple countries provide a significant advantage. The promotion of AWD farming and the introduction of digital currency are expected to contribute not only to decarbonization, but also to Bangladesh’s economic development, giving this project substantial social significance.

Project Overview

Project period: Until the end of March 2028

The project will begin with an initial survey and feasibility study. Based on the results, the partners will consider moving into a demonstration and commercialization phase.

During the initial survey and feasibility study, the project will proceed with trial installation of water management infrastructure and development of a data collection framework. If the project advances to the demonstration and commercialization phase, the target areas and number of participating farmers are expected to be expanded in stages.

The project will also conduct studies with local government agencies, including the central bank, as well as financial institutions, regarding the issuance and management of digital currency. These studies will examine key issues, system design, and operational methods for returning environmental value to participating farmers.

In parallel, interviews will be conducted with agents such as commercial banks and money transfer operators. The project will compare digital currency with existing local payment methods and examine concrete plans for system development, including potential integration and connection with those payment methods.

Main Activities

1. Demonstration of labor-saving and high-precision water management

The project will verify labor-saving and high-precision water management methods required for AWD farming by combining Japanese automated sluice gates and water-level gauges with AI-based image analysis.

AI will analyze images from water-level gauges to determine water-level conditions. Based on these results, farmers will be notified when sluice gate operation is required, helping to reduce their workload while enabling more accurate water management.

If the project proceeds to the demonstration and commercialization phase, the partners will consider a phased rollout of water management DX, targeting the introduction of more than 20 automated sluice gates and more than 100 water-level gauges and other measurement devices. Through this effort, the project aims to contribute to the wider adoption of AWD farming.

2. Study and verification of a model-based JCM methodology

As AWD farming expands, reducing the burden of MRV for greenhouse gas emissions reductions will become increasingly important.

This project will study and verify a model-based Joint Crediting Mechanism methodology that does not rely solely on gas measurement. It will examine methods for understanding emissions reductions by utilizing data related to water management, soil, weather, and farming processes.

3. Development of an environmental value return model using digital currency

To encourage farmers participating in AWD farming to continue their efforts, the project will develop a mechanism for returning the environmental value created through their participation using digital currency.

By using blockchain technology, the project aims to increase the transparency of return histories and ensure reliable value transfer to participating farmers. Given local challenges associated with ensuring transparency and certainty in cash-based returns, as well as issues such as fees for existing payment methods, the partners will work with government agencies to demonstrate and build a foundation for returning environmental value through blockchain-based digital currency.

Roles and Responsibilities

Soramitsu CBDC will act as the lead applicant and will drive the overall project. The company will be responsible for developing the digital currency system, as well as managing and returning environmental value.

Ryobi Systems will participate as the joint applicant. Drawing on its experience from demonstration projects conducted in Bangladesh, Ryobi Systems will promote AWD farming guidance and education, water management DX, development of an agricultural data platform, and data utilization for the creation of carbon credits.

The project will also be carried out in collaboration with the Bangladesh Rice Research Institute, the University of Dhaka, local government agencies, microfinance institutions, participating farmers, and other stakeholders. Together, the partners will advance greenhouse gas measurement and analysis, decarbonization research, development of local operating structures, and studies on the use of digital currency.

Future Outlook

Through the initial survey, master planning, and feasibility study, the project will establish the foundation for implementation and conduct various forms of verification. In the subsequent demonstration and commercialization phase, the partners aim to gradually expand the target areas and number of participating farmers and establish a sustainable operating model.

The partners will also seek to deploy this model, which combines water management DX with environmental value returns, across Bangladesh. Looking ahead, they will explore applications in other regions and countries, contributing to both agricultural decarbonization and economic development across the Global South.

Through these initiatives, Soramitsu CBDC and Ryobi Systems will promote the establishment and social implementation of a new agricultural GX model that utilizes ICT and digital currency.

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