Vietnam reports positive results from partnership project on carbon market formation

The Vietnam partnership for market readiness project has drawn wide attention to the carbon market

This was announced by experts at the final workshop themed “The Vietnam partnership for market readiness project” (VNPMR) organised in Hanoi on December 29.

VNPMR has been implemented in Vietnam for five years. The project is sponsored by the World Bank with the participation of the ministries of Planning and Investment, Finance, Industry and Trade, Construction, as well as National Resources and Environment (MoNRE).

According to the Department of Climate Change, the management authority implemented numerous deep studies and proposed policies and state instruments about the carbon market, including credit mechanism, the emissions trading system (ETS), the responsibility on paying fees and tax for emissions, and the green certificate. Through this work proposals have been made to set out a carbon pricing mechanism and that the subjects will have to pay after their greenhouse gas emissions.

In addition, after implementing the project in the steel and waste-to-power sectors, numerous enterprises, especially foreign-invested companies have shown interest in the carbon market, showing positive signs for expansion.

Luong Quang Huy, the project coordinators said, “In order to build and develop the carbon market in Vietnam, it is necessary to comprehensively evaluate its impact on socioeconomic development and the environmental sector as well as manufacturers’ operations, while simultaneously studying the experiences of other countries.”

“In addition, Vietnam also needs to build a regulatory system to manage this sector, which suits the country’s socioeconomic situation and international practices. Last but not least, it is necessary to methodically implement the project, from the pilot activities to official operation and then connect it with international markets,” Huy said.

In the framework of the project, the coordination committee organised a workshops themed “Development of carbon market in Vietnam: market-based instruments and application potential” organised in Vinh Phuc on October 22 and Ho Chi Minh City on October 29 in order to update participants on the main results and to appraise carbon and the impact of Vietnam's carbon market development policy.

In addition, the committee has systematised information and created a database on CO2 emissions as well as analysed market tools and determined the application potential in Vietnam. Furthermore, it has specified the CO2 emission potential in these two sectors and developed a reporting system for greenhouse gas reduction activities. A domestic and international carbon credit business roadmap will also be developed.