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The formation of a carbon market in
Vietnam, however, very much remains in
the preparatory stage.
The Law on Environmental Protection
2020 stipulates the organization and devel-
opment of a domestic carbon market,
while the government also issued Decree
No. 06/2022/ND-CP on the mitigation of
greenhouse gas emissions and the protec-
tion of the ozone layer, on January 7, 2022.
These are important legal instruments for
the carbon market to develop and represent
a foundation for the future.
Under a project conducted by the Min-
istry of Natural Resources and Environment
(MoNRE), Vietnam will pilot the operation
of a carbon credit market in 2025 to connect
and exchange carbon credits with regional
and international markets, then officially
operate a carbon trade exchange in 2028.
There is still much to be done for its
carbon credit market to develop smoothly
and effectively.
Taking shape
From now until the end of 2027, the
Vietnam’s carbon market is gradually coming together government will focus on developing reg-
and is expected to boast significant potential. ulations on carbon credit management
and the exchange of greenhouse gas emis-
By QUOC UY sion quotas and carbon credits.
Additionally, manufacturers and service
providers must be aware of their respon-
sibility in environmental protection and
lobally speaking, a carbon border According to the World Bank Group’s accept the basic principle of the carbon
adjustment mechanism (CBAM) Country Report on Climate and Devel- credit market, where polluters must com-
G is aimed at reducing greenhouse opment for Vietnam in 2022, the effects pensate for their emissions by exchanging
gas emissions in high-polluting sectors, of climate change cost the country roughly and trading carbon credits.
as it imposes charges on imports from $10 billion in 2020, or approximately 3.2 Training on the Emission Trading Sys-
carbon-intensive manufacturers while per cent of its GDP. tem (ETS) and carbon market is therefore
encouraging decarbonization efforts to A carbon credit market, if well devel- necessary. Some 145 officials from relevant
achieve a net-zero future. oped, would contribute to saving a large State agencies, organizations, and enter-
The mechanism has been applied in sum of money. More importantly, it has prises attended such training on February
many of Vietnam’s key export markets, been identified as a key solution for Vietnam 26 and 27, where leading international
including the US and the EU. In order to to reach its net-zero emissions goal it com- experts shared experience in global carbon
maintain its export growth, Vietnam must mitted to at COP26. pricing, the necessary preparations for
therefore reduce its own carbon-intensive The way forward will, however, be operating a carbon market, and meas-
production and services. long and problematic. Vietnam faces urement, reporting, and verification
Low-carbon economic development many challenges in building and devel- (MRV) requirements within an ETS.
towards a circular economy is becoming oping a carbon market, such as the absence The training resulted from an MoU
an inexorable tendency in global efforts for of a legal framework, insufficient inter- signed between the Department of Climate
green transition, with the creation and national cooperation, and limited aware- Change at MoNRE and the United
development of carbon markets seen as an ness. To address such issues, the country Nations Office for Project Services
increasingly crucial tool. As a deeply globally has issued a number of significant strategic (UNOPS), which aims to establish coop-
integrated economy, there is no alternative initiatives on sustainable development erative relations between the two sides
for Vietnam but to follow such tendencies. and green growth, one of which is a devel- within the framework of the Southeast
With carbon credit trading new in the opment plan for instruments related to Asia Energy Transition Partnership (ETP)
country, however, most Vietnamese enter- carbon pricing, particularly a market for managed by UNOPS.
prises remain unaware of its importance. compliant carbon. The above-mentioned legal framework
Mr. Nguyen Vo Truong An, Deputy Direc- In fact, a carbon credit market has and preparatory work are certain to create
tor of the Carbon Credit Trading Platform been taking shape in Vietnam since 2005, the necessary conditions for the formation
JSC (CCTPA), was quoted by the Vietnam when the country participated in the inter- of a carbon credit market in Vietnam.
News Agency on October 9, 2023 as rec- national carbon market through imple- With an emerging market economy
ommending the formation of a consulting menting carbon credit projects, with the growing at a rather rapid pace, and the
agency responsible for keeping Vietnamese first being the UN-run Clean Development government’s determination and persistent
enterprises fully informed about the reg- Mechanism (CDM). policy regarding a green transition, while
istration and verification of carbon credits. Vietnam is one of four countries with the enjoying international cooperation, Viet-
With such an agency, enterprises would highest number of investment projects reg- nam is expected to have a carbon credit
be “better prepared for a new carbon istered under the CDM, having received 40.2 market of significant potential, though a
tariff regime,” Mr. An believes. million carbon credits for 150 projects. host of challenges still lie ahead. %

28 Vietnam Economic Times April 2024 en.vneconomy.vn