In a global race towards zero greenhouse gas emissions by 2050, attracting finance from the private sector by further involving different sectors participating in green growth will help countries increase their financial, technological, and engineering resources significantly. Therefore, Vietnam has established a legal system to promote private enterprises engaging in the implementation of sustainable development goals and green growth investment. 

Thus, experts evaluated that the government can do better. Supporting policies must be more open, direct, and effective. 

The definition of Green Growth

The definition of green growth varies depending on each country and organization. The different meaning of green growth reflects the vision, condition, mission, and orientation of the states and societies. 

In Vietnam, green growth is defined by modifications in the growth model, reconstructing the economy in order to make the most of current comparative advantages. Moreover, improving the competitiveness of the economy through the application of advanced technology and modern infrastructure systems is another matter of concern in Vietnam. The country’s goals are reduction in greenhouse gas emissions, poverty alleviation, and sustainable economic expansion. 

The Vietnamese Green Growth Program is concretized through the “National Strategy for the period 2011 to 2020 and vision to 2050.” To ensure sustainable development and green growth, the Government is determined to promote the widespread application of environmentally friendly production processes. Furthermore, authorities want to improve the efficiency in the utilization of national resources, reducing emissions and limiting the increase in pollution.

If the strategy goes as planned, human health and sustainable economic development will be simultaneously guaranteed. Vietnam aims to build a civilized, harmonious, and climate-friendly consumer culture through the gradual implementation of eco-labeling, green shopping, and market development for ecological products.

State of development policy

One of the most noteworthy legal documents on green growth is Resolution No. 24-NQ/TW of the Party Central Committee on a proactive response to climate change. The Resolution strengthens resource management and environmental protection, with the focus on promoting the transformation of the growth model associated with economic restructuring. 

This proposal has set the stage for a series of adjustments, amendments, and supplements to green-growth-related laws. With support from the Ministry of Planning and Investment, many ministries and localities have developed and implemented their Green Growth Action Plans. Additionally, several cities have become typical models of green economic development: Da Lat, Hoi An, Hai Phong, and Ha Long. 

Before that, the government has enforced the national strategy on green growth in phases. For example, Decision 1393/ QD-TTg in 2012 approving a program on ecological development for the 2011 to 2020 period with a vision to 2050 suggests 17 solutions to a more sustainable economy. Proposed resolutions include technological innovation, ecological urbanization, international cooperation to promote technology transfer, and human resource development, among others. In 2021, the decision was substituted by Decision 1658/ QD-TTg for the same period. 

Vietnam also finalized and approved its green growth program before the 2021 United Nations Climate Change Conference (COP26). At COP26, Vietnam showed its commitment to achieve “zero net emissions” by 2050, reduce methane emissions by 30 percent by 2023, and gradually eliminate coal power during the 2030 to 2040 period. To accomplish set targets, the Vietnamese government must accelerate its Green Growth Strategy and concretize contents in the Green Growth Action Plan following its affirmations. 

Evidently, efforts toward a more environmentally friendly economic growth in Vietnam have become more comprehensive in the past few years. Today, green development in Vietnam has been applied to a wide range of socio-economic aspects such as manufacturing, energy, technology, architecture, and so forth.

Current state of Vietnam green growth

Achieved results

After nearly ten years of implementing the Green Growth Strategy, the awareness of Vietnamese people about the importance of an ecological economy has been raised remarkably. Hence, Vietnam’s society has been gradually changing its manufacturing and living behaviors. Furthermore, safe and civilized production and consumption models appeared, imbued with the national identity and friendly with nature. 

In addition, measures to actualize green growth goals have brought about outstanding results: 08 ministries, as well as 34 central-affiliated cities and provinces, have issued action plans to execute new development. Among those programs, much content has been thoroughly studied and integrated into resolutions, laws, decrees, and circulars of the Party, National Assembly, and ministries. 

Along with that, some of the main goals of the strategy for the 2011 to 2020 period have received positive results. To exemplify, solutions to reduce greenhouse gas emissions have been widely deployed in all fields.

Statistically, greenhouse gas emissions in energy activities decreased by 12.9 percent compared to the normal development plan. Also, energy consumption as a percentage of GDP fell by 1.8 percent per year on average. Plus, the percentage of industrial enterprises with awareness of resource-efficient has grown from 28 percent in 2010 to 46.9 percent in 2020. On top of that, climate-friendly production activities ensuring natural capital investment and development as well as active pollution prevention and treatment also received enormously more attention. Since awareness of green growth has been raised, the government attracted a wave of green investment in fields such as wind energy, solar energy, and garbage power.

Some challenges

Beside bright spots in green growth achievements, the transformation of the economy towards new development also faces some difficulties. One of the challenges is the unclear policy mechanism, especially in finance, lacking appeal to the private sector while public investment capital is still limited. Plus, while green growth is now interested by many localities and applied in many businesses, its importance is still not as appreciated as that of economic growth. 

Despite some current remaining issues, the government has been directing the implementation of national and local green growth programs, prioritizing energy transformation to fulfill Vietnam’s commitment to COP26.  

Converting the traditional economic model to a green economy is a trend that many countries around the world are aiming for. Vietnam is setting many priorities to actualize this new development and hence needs to attract investment capital for sustainable development projects. 

To learn more about opportunities and challenges investing in Vietnam’s new growth model, contact Viettonkin Consulting now via our website. With our deep knowledge of the Vietnamese economy and geography, Viettonkin can provide you with insights into this novel and promising field for your decision process.