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Vietnam is laying the foundation for a national carbon market
Vietnam is laying the foundation for a national carbon market—an important step toward aligning its economy with global climate and trade standards.
On June 11, 2025, Vietnam launched the pilot phase of its national Emissions Trading Scheme (ETS), covering steel, cement, and thermal power—sectors responsible for nearly half of the country’s CO₂ emissions. A centralized carbon trading platform, operated by the Hanoi Stock Exchange, will support verified trading of emission allowances and certified credits.
This move aligns Vietnam with global trends—especially as mechanisms like the EU’s Carbon Border Adjustment Mechanism (CBAM) begin imposing carbon costs on imports. A domestic carbon price not only helps local exporters stay competitive but also keeps carbon revenues within the country for reinvestment in green growth.
Vietnam has already demonstrated the potential of carbon credit monetization through a $51.5 million results-based payment program with the World Bank, benefiting over 7,000 forest owners and 1,300 local communities. New initiatives—such as the low-emission rice farming program in the Mekong Delta—are poised to further expand credit supply while supporting rural livelihoods.
The development of a carbon market also lays the groundwork for Vietnam’s green finance ecosystem.
By pricing carbon (Read more on how World Bank’s carbon pricing aid Vietnam) and validating emissions reductions, Vietnam can create a pipeline of investable green projects—opening the door for green bonds, sustainability-linked loans, and climate funds. This could help mobilize both domestic and international capital for clean energy, sustainable agriculture, and low-carbon infrastructure.
While things are progressing, this remains an early-stage journey. Key mechanics are still being developed, and limited public information is available on how full implementation will unfold. But the direction is clear: Vietnam is taking deliberate steps to embed carbon pricing into its national strategy, aiming to align with global trade norms and unlock new sources of sustainable growth.
Photo: Viet Center Tourist
