National Conference on Developing Vietnam’s Green Financial Market: Challenges, Urgent Issues, and Breakthrough Solutions

3/28/2025 1:47:48 PM

Hanoi, October 31, 2024 – On the morning of October 31, 2024, at No. 1 Lieu Giai, Ba Dinh, Hanoi, the Vietnam Institute of Economics (under the Vietnam Academy of Social Sciences) hosted a scientific seminar titled “Developing Vietnam’s Green Financial Market: Challenges, Urgent Issues, and Breakthrough Solutions.” The event brought together representatives from government ministries, banks, international financial organizations, and leading experts in finance and economics.

The Importance of the Green Economy
Since 2012, Vietnam has initiated the National Strategy on Green Growth, aiming to achieve net-zero emissions by 2050. According to estimates by the Asian Development Bank (ADB), Vietnam needs to mobilize approximately $368 billion by 2040, equivalent to 6.8% of annual GDP, to realize its green growth goals.

In her opening remarks, Dr. Bui Thi Quynh Tho, a specialized member of the National Assembly's Economic Committee, emphasized that transitioning to a green and circular economy is an irreversible global trend. Vietnam must strengthen its mechanisms to attract investment from private and international sectors into green projects.

Challenges and Proposed Solutions
At the conference, experts discussed the advantages and obstacles in developing a green financial market, including:

• Opportunities: International commitments to combat climate change, technological innovation, and rising demand for clean environments among the middle class.
• Challenges: An incomplete legal framework, inconsistent and insufficient information on green finance, and difficulties in green bond investment and issuance.

Although green credit and bonds have grown by over 20% annually since 2017, they remain limited compared to the capital demand for green transformation projects. Vietnam has issued approximately $1.16 billion in green bonds from 2019 to 2023, a modest figure compared to the annual $20 billion needed.

Insights from Key Experts
Dr. Le Xuan Sang, Deputy Director of the Vietnam Institute of Economics, highlighted that Vietnam's green financial market requires a more comprehensive legal framework, better information transparency, and consistent standards for green projects.

ADB's Chief Economist in Vietnam, Dr. Nguyen Ba Hung, called for proactive engagement in international funding mechanisms through bilateral cooperation and global financial institutions. He also advocated for developing Vietnam’s carbon market and integrating it with international systems.

Deputy Director of the Institute of Strategy and Financial Policy, Dr. Nguyen Thanh Nga, pointed out that Vietnam’s green financial market faces challenges such as unclear green project evaluation standards, a lack of institutional investors, and low market liquidity. She proposed revising the legal framework, introducing tax and fee incentives, and developing transparent financial intermediaries to drive market growth.

The Role of Green Bonds
Experts emphasized green bonds as a crucial financial tool for advancing a green economy. While Vietnam ranks second in ASEAN for green debt issuance, trailing only Singapore, there is a need to diversify green financial products and establish independent evaluation agencies to ensure transparency and market efficiency.

Reducing Greenhouse Gas Emissions
Dr. Nguyen Thi Lieu from the Institute of Hydrometeorology and Climate Change under the Ministry of Natural Resources and Environment highlighted Vietnam’s legal measures for greenhouse gas reduction, including Decree 06/2022/ND-CP and Decision 13/2024/QD-TTg, which outline the roadmap for developing a domestic carbon market and implementing monitoring, reporting, and verification (MRV) systems.

Call for Collaborative Efforts
Experts stressed that achieving Vietnam’s COP26 commitments will require mobilizing political, governmental, and societal efforts alongside robust resources to ensure sustainable development, reduce emissions, and protect the environment.

Conclusion
The seminar served as a valuable platform for discussions among participants. Its outcomes are expected to provide useful insights for legislative and policy-making bodies to advance the development of Vietnam’s green financial market, fostering sustainable development and green growth.