At the Vietnam Net Zero 2025 forum held last week, Dr. Le Xuan Nghia, director of the Institute for Development Consultancy, underscored the urgent necessity of building a carbon market amid escalating climate threats. He pointed to the doubling of atmospheric CO2 levels over the past two centuries, contributing to an uptick in the frequency and severity of natural disasters and global pandemics.
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| Some 80 nations have adopted carbon tax or trading schemes Photo: Le Toan |
“Previously, a global pandemic occurred roughly every 200 years; now it happens every 16 years,” Nghia noted. “An estimated 1.6 million viruses, once confined to forest ecosystems and wild animals, are gradually finding pathways to humans.”
Such trends, he argued, elevate climate action from a moral responsibility to a national and business survival imperative. “Even if the current US president disapproves of net-zero policies, every American company operating in Vietnam must still submit reports on greenhouse gas (GHG) emissions and environmental, social, and governance,” he said. “Without these disclosures, they risk losing access to global supply chains, particularly among environmentally conscious consumers.”
On the domestic front, the Vietnamese government is moving decisively. Since August 2024, over 2,000 enterprises have been required to report their GHG emissions, an obligation that reflects the country’s commitment to sustainable growth and global integration.
Vietnam’s engagement with international carbon markets dates back to the early 2000s. The Ministry of Agriculture and Environment reports that approximately 150 local projects have generated 40.2 million carbon credits for global trading. The country ranks among the top four nations globally for Clean Development Mechanism project registrations, behind only China, Brazil, and India.
In May, the Ministry of Finance submitted a draft decree on establishing a national carbon credit exchange. The platform is expected to commence pilot trading by year-end and integrate with international mechanisms under Article 6 of the Paris Agreement by the end of this decade.
Le Quang Linh, an emissions reduction and green finance specialist at Giant Barb Science & Environment JSC, said Vietnam offers a rich landscape for carbon project development. Promising areas include biochar production from agricultural waste, biogas recovery in livestock farming, and waste-to-energy technologies.
Biochar, for example, can reduce emissions by 10-12 per cent while storing carbon in soil long-term. Vietnam’s biogas initiatives have already benefited over 725,000 people, issuing nearly one million credits annually. Meanwhile, methane capture from landfills can produce approximately 780kWh of electricity daily per million tonnes of waste, while waste-to-energy facilities processing 4,000 tonnes of refuse could yield up to 200MW of electricity and reduce landfill volume by up to 95 per cent.
Despite these opportunities, Linh cautioned that Vietnam’s carbon market is still in its formative stage. A lack of standardised and digitised measurement, reporting, and verification (MRV) systems presents a significant barrier, complicating credit validation and quota management.
“To fully leverage the carbon market’s potential, Vietnam must enhance its legal and policy frameworks, invest in internationally aligned MRV infrastructure, and scale up green financing through innovative tools and global partnerships,” he suggested.
Assoc. Prof. Nguyen Dinh Tho, vice president of the Institute of Strategy and Policy on Agriculture and Environment, said, “If the cost of tech upgrades is lower than the market price for carbon credits, companies should invest. If not, they can buy credits as a short-term solution while planning future investments. Once the ecosystem is in place, Vietnamese enterprises will adapt quickly.”
Data from the Ministry of Agriculture and Environment revealed that Vietnam successfully sold 10.3 million carbon credits in 2024, earning $51.5 million and placing the country among the world’s top 15 credit sellers. Annual revenue potential is projected to reach up to $300 million.
According to the World Bank, 80 countries have adopted either carbon tax or trading schemes. These mechanisms currently cover 28 per cent of global GHG emissions, equivalent to 12-14 billion tonnes of CO2 annually.
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