Newsletter
Vietnam Environment Spotlight - December 2021
Freshfields' Vietnam Environment Spotlight keeps you up-to-date with the key business and legal developments in this sector. Please contact us if you would also like to receive our Vietnam M&A Spotlight, Vietnam Infrastructure Spotlight or Vietnam Competition Law Spotlight.
Preliminary note: A new Environmental Working Group of the Vietnam Business Forum has been established. Please contact either the Secretariat at info@vbf.org.vn if you are interested in joining or us at Freshfields if you would like further information. A Freshfields representative sits on the Steering Committee.
MARKET UPDATES
COP26 commitments
In a speech at the start of the 26th UN Climate Change Conference of Parties (COP26), Vietnam’s Prime Minister announced a net-zero emissions target by 2050 and a plan of action on forest and land use. Vietnam also joined nearly 90 countries in a US- and EU-led effort to slash emissions of the greenhouse gas methane by 30 per cent by 2030 (from 2020 levels), a pact aimed at tackling one of the main causes of climate change. Source: HanoiTimes
CO2 offsets
A delegation of Vietnam’s Ministry of Industry and Trade (MOIT) at the COP26 meeting signed a Letter of Intent with LEAF/Emergent to offset 5.15 million tons of CO2 emissions through forests in the South-Central region and Central Highlands in the 2022-2026 period. LEAF/Emergent will pay a minimum price of US$ 10/ton of CO2, resulting in a total value of US$51.5 million. The registered area of emissions reduction commercial forest is 4.26 million ha, including 3.24 million ha of natural forest and 1.02 million ha of plantation forest. Source: VietnamNet
Carbon emissions trading
Vietnam’s rapid economic growth and its increasing energy demands have led to an exponential increase in greenhouse gas (GHG) emissions, leaving the country with the second highest air pollution levels in Southeast Asia in 2019. To meet its development and climate change goals, a new domestic carbon emission trading scheme enabled by the revised Law on Environmental Protection aims to create a carbon pricing instrument that will penalize emitters of GHG emissions based on the principle of “polluter pays.” Source: World Bank
Green ambition
The draft National Power Development Plan for the period 2021-30, with a vision to 2045 will be revised to align with Vietnam’s commitment to net-zero emissions by 2050 made at COP26. The MOIT is recalculating the country’s electricity generation sources. Source: Vietnam Plus
Green strategy
The Prime Minister has approved the National Green Growth Strategy for the 2021-30 period, with a vision to 2050, with ambitious goals to push Vietnam’s sustainable development to greater heights. The Government will strive to reduce GHG emissions per GDP by at least 15 per cent by 2030 against the level recorded in 2014, and at least 30 per cent by 2050. Other key targets include collecting and treating at least 95 per cent of urban solid waste by 2030, and 50 per cent of wastewater. Source: MOIT
Green geopark
An international conference took place in Lang Son on 29 November 2021 to discuss how to take advantage of PPP in establishing a 3,900sq km geopark in the northern mountains. The establishment of the geopark aims to not only preserve and promote local geological heritage, but also add to protect the environment, and effectively respond to natural disasters and climate change in Lang Son and north-eastern provinces at large. The province also expects Lang Son Geopark to be recognized as a global geopark by UNESCO. Source: Vietnam Net
Greenbacks
Affinity Investment Fund and HDBank have signed a US$300 million financing agreement to support Vietnamese firms with programmes that meet ESG and sustainable development criteria. The agreement was signed on the sidelines of COP26. Source: Vietnam News
Blue hydrogen
On 4 October 2021, a group of investors including Enterprize Energy Group (UK-Singapore), proposed an investment project in Thang Long Wind 2 to produce hydrogen from seawater electrolysis, for export to South Korea, Japan and Singapore. Utilising the existing Thang Long Offshore Wind Farm project off Binh Thuan province, the potential energy that could be amassed is 2,000MW for a total investment cost of US$5 billion. This would be the first seawater electrolysis hydrogen production project in Vietnam. Source: Bizhub
Blue oceans
Marine plastic waste is an urgent issue in coastal Vietnam and the country needs to carry out practical measures to manage and reduce marine plastic waste to ensure sustainable development of the fishery industry. Plastic consumption has been increasing 16-18 per cent annually in Vietnam, and the amount of plastic waste discharged into the environment and the ocean has also increased. Vietnam is the fourth major producer of fish and aquaculture in the world, with the seafood export turnover reaching US$8.5 billion a year. Source: Nhan Dan
Central smarts
Smart city development is in fact a digitalization process within each city or urban area. A number of cities, such as Hue and Da Nang, have achieved positive results in becoming smart cities. Source: Hanoi Times
