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BUSINESS REPORT

PHOTO: VIET DUNG

Offsetting exposure

Vietnam is looking to international experience and recommendations
as it streamlines the development of a domestic carbon market.

| By LINH GIANG

seminar was co-organized in Hanoi require high green standards. Moreover, credits globally since the mid-2000s, Mr.
on November 23 by the Ministry developing countries like Vietnam will Nguyen Tuan Quang, Deputy Director
A of Foreign Affairs (MoFA), the Min- encounter a host of challenges without General of the Department of Climate
istry of Natural Resources and Environment support from the international community Change at MoNRE, told the seminar. This
(MoNRE), and the Organization for Eco- and development partners. has taken place via the Clean Development
nomic Cooperation and Development “The development of a carbon market Mechanism (CDM) since 2006, Gold Stan-
(OECD) on developing Vietnam’s carbon is not easy, with a long distance from dard (GS) and Verified Carbon Standard
market, with the theme “International strategy to policy implementation, espe- (VCS) since 2008, and the Joint Crediting
Experience and Policy Implications for cially for developing countries without Mechanism (JCM) with Japan since 2013.
Vietnam”. In the context of its green tran- standardized green systems,” Deputy Min- According to the Department, Vietnam
sition, the development of a low-carbon ister Vu emphasized. Furthermore, carbon has 150 projects that have been granted
economy towards a circular economy has pricing will directly impact the competi- 40.2 million carbon credits in global carbon
become an inexorable trend in the country, tiveness and business models of many markets. It stands as one of the top four
making the establishment, operation, and enterprises, requiring a fair and compre- countries with the highest number of reg-
development of a carbon market increas- hensive transition process. istered CDM projects, following China,
ingly crucial. Given its significance, the The development of the carbon market Brazil, and India. In terms of credits
workshop discussed international experi- will pose a series of challenges for Vietnam, obtained from CDM projects, it ranks
ence and recommendations for Vietnam he continued, notably the requirement to ninth among 80 countries and territories.
in developing its carbon market, including enhance awareness among the public, busi- Vietnam has also implemented several
improving the policy framework, enhancing nesses, and government. Other challenges technical support projects to prepare for
human resources, bolstering infrastructure, include leveraging the carbon credits of the establishment and development of the
and promoting international cooperation. potentially rich local forests, issues relating domestic carbon market.
to a consistent legal framework compatible
MODERN CHALLENGES with international standards, and ensuring INTERNATIONAL EXPERIENCE
The development of a carbon market is that policies support vulnerable groups in According to Professor Jos Delbeke,
not only an increasingly common trend in the green transition. Additionally, Vietnam Chair on Climate Policy and International
many countries but also an essential require- needs to urgently prepare a knowledgeable Carbon Markets at the European Invest-
ment for all, Deputy Minister of Foreign workforce, infrastructure, and necessary ment Bank (EIB), when looking into devel-
Affairs Nguyen Minh Vu said in his opening conditions for operating greenhouse gas oping a carbon pricing system, the initial
remarks at the seminar. If Vietnam does emission trading platforms and carbon challenge is acquiring high-quality data,
not stay abreast of trends, it will not only credit systems. which not only needs to be of good quality
fail to achieve its sustainable development While the carbon market is still in its but also instill confidence regarding its
goals but will also face difficulties in access- developmental stages, Vietnamese busi- authenticity. Most countries, when initiating
ing fastidious markets, which increasingly nesses have actively exchanged carbon a carbon pricing system, lack the excellent

32 | VIETNAM ECONOMIC TIMES | DECEMBER 2023 en.vneconomy.vn