The agricultural sector, in which Agribank plays a pivotal role, has substantial green financing needs across three primary areas. — VNA/VNS
HANOI: Given the severe impacts of climate change, the transition to a green economy is no longer a choice but a crucial requirement for sustainable development.
In this context, the demand for capital to support sustainable development initiatives has never been more pressing.
Agribank’s deputy head of Credit Policy, Vuong Van Quy, highlighted this at a recent workshop,
According to the United Nations Economic and Social Commission for Asia and the Pacific, Vietnam requires approximately US$45bil to US$55bil annually to achieve its sustainable development goals by 2030.
This figure far exceeds the capabilities of the government budget and necessitates the involvement of the entire financial system.
The agricultural sector, in which Agribank plays a pivotal role, has substantial green financing needs across three primary areas.
First, there is a demand for capital to transition from fragmented production models to large-scale operations that leverage advanced technology, smart machinery and efficient irrigation systems in critical regions like the Mekong Delta.
Financing is also crucial to meeting stringent environmental, social and governance (ESG) standards from export markets like the European Union, the United States and Japan.
This includes costs for certifications such as GlobalGAP and organic farming, along with establishing traceability systems.
Meanwhile, significant initial investment is required for circular economy models, which embrace recycling agricultural by-products, biomass energy production and solar rooftop installations.
These fields necessitate substantial upfront capital, but are instrumental in reducing emissions and protecting the environment.
Recognising its responsibilities as a leading state-owned commercial bank in agricultural development, Agribank has committed to green growth as a core part of its business strategy.
The bank aims not only to provide funding, but also to support the government and the State Bank of Vietnam in realising the National Strategy for Green Growth for the 2021to 2030 period.
As of the third quarter of 2025, Agribank reported total green credit outstanding of nearly 28.4 trillion dong, serving nearly 40,000 customers.
The portfolio structure indicates a clear focus on three key areas: renewable energy and clean energy, leading with nearly 15.3 trillion dong (53%), sustainable forestry at over 6.9 trillion dong (24%) and green agriculture at nearly six trillion dong (21%).
The year 2025 marks a significant turning point, with two groundbreaking legal documents.
Decree 156/2025/ND-CP, effective from July 1, is the first to allow credit institutions to lend up to 70% of project value for organic agriculture or circular economy models without collateral.
This change is considered a historic breakthrough, liberating co-operatives and agricultural enterprises that previously struggled with a lack of collateral.
Additionally, Decision 21/2025/QD-TTg, issued on July 4, has established clear environmental criteria and a green classification list, enabling banks to accurately identify and assess green projects while avoiding “greenwashing” risks.
Furthermore, along with these positive developments, several challenges remain in expanding green financing. — Viet Nam News/ANN
