Vietnam seeks ways to fund green growth and tackle climate change issues

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HANOI, June 12 (Xinhua): Vietnam will need US$368 billion or 6.8 per cent of GDP per year, through 2040 to tackle climate change, the Vietnam News newspaper reported on Monday.

Vietnam's latest power development plan estimated that the country would need US$134.7 billion to shift away from coal-fired power toward renewable energy, developing new power plants and power grids, between 2021 and 2030, the report said.

Working toward the dual targets of becoming a high-income country and achieving carbon emission neutrality in the next 30 years will require Vietnam to raise large funding, according to the International Finance Corporation.

The operation of the carbon trade exchange is expected to create a framework for Vietnam to monetize reduced emissions while working toward carbon neutrality by 2050.

According to a recent report by the Ministry of Natural Resources and Environment, total emissions will reach 928 million tons of carbon dioxide equivalent by 2030 and 1.5 billion tons by 2050 in a moderate scenario.

Vietnam has a high emission intensity per GDP unit compared to other countries in the South-East Asian region of around 0.35 kilograms of carbon dioxide per 1 US dollar.

Experts suggested the government promote the use of carbon pricing instruments with a focus on developing a carbon market.

Under the plan proposed by the Ministry of Natural Resources and Environment, Vietnam is preparing to develop regulations on carbon credit management and exchange of greenhouse gas emission quotas and carbon credits. The process is due to complete in 2027.

Vietnam has an untapped potential market of carbon credits from such sectors as energy, forestry, and agriculture, said Le Xuan Nghia, former vice chairman of the National Financial Supervisory Commission.

He explained that carbon credits would be increasingly scarce as few countries still have primary forests left, meanwhile, Vietnam has 14.7 million hectares of forests.

A carbon market allows countries to sell to or buy from countries that emit more or less than their committed target.

It was estimated that Vietnam can sell 57 million carbon credits to international organizations annually with each credit priced as much as 5 US dollars. - Xinhua