session ii - 1 - vietnam - by ms trinh and ms nhung

8/12/2019 Session II - 1 - Vietnam - By Ms Trinh and Ms Nhung

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Progress on the Viet Nam

Green Growth Strategy

Presentation for the G20 Development Work

Workshop on Inclusive Green Growt

Ms. Nguyen Thi Dieu Trinh(DSENREVietnam Ministry of

Ms. Ngo Thi Nhung(Vietnam Ministry of Finance)

Moscow - July 2013


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Content

Overview of the Vietnam National Green Growth Strategy (VGGS)

Institutional framework

Key Challenges

Green growth financing

Tools and Instruments

Next Steps


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Overview of the Vietnam National Green Growth S(VGGS)

Approved on September 25th2012 by the Prime Minister (decision 1393/QD-TTG)

Overall objective of the VGGS(Low carbon Development Strategy) Green growth, as a means to achieve a low carbon economy and to enrich natural capital, w

principal direction in sustainable economicdevelopment; reduction of greenhouse gas emisscapability to absorb greenhouse gas are gradually becoming essential indicators in social-ec

3 strategic tasks outlining the scope of the strategy

Low Carbon Growth

Greening of Production

Greening of Lifestyles

17 solutions addressing specific Green Growth policy directions for sectors and provinces

10 priority actions to initiate immediate Green Growth action

Overall supervision through the National Committee on Climate Change which is headed by the


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Participatory ProcessPrime Minister assigns the Ministry of Planning and Investment to formulate and implement the Vietna

Green Growth Strategy (Notice 38/TB-VPCP dated 03/03/2011 and Decision 1393/QD-TTg dated 2

Phase 1

Establish Drafting Board and Editing Board including Ministerial Leaders and Directors from rele

(Finance, Industry and Trade, Natural Resources and Environment, Agriculture and Rural Deve

Transportation, Science and Technology and Construction)

Formulate the Green Growth Framework for Vietnam with consultation with international commun

November 2011

Phase 2: Building the Vietnam National Green Growth strategy

Consultation with stakeholders (twice with business community, 3 times with local authorities, res

and social society organization and international community in 5, 2012)

Receiving directions from Country Top Leaders through thematic reports and comments from mem

National Council for Climate Change; getting recommendations from Drafting Board and Editi

Assessments on low carbon development options

Gaining experiences through site visits: South Korea, Mexico, Germany and the Netherlands

International Expert consultations (with support from UNDP, WB, KOICA and GGGI).


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Targets

The VGGS sets the following targets for GDP growth and GHG emission reductions:

For the year 2020:

GDP per capita is doubled compared to 2010

Reduce energy consumption per unit of GDP by 1.5 to 2% per year

Reduce intensity of greenhouse gas emissions per unit of GDP by 8-10% or double thinternational support

For the year 2030:

Reduce total GHG emissions by at least 1% per year without and 2% with internation

Environmental degradation is addressed and natural capital stocks have been improvaccess and use of clean and green technology is significantly enhanced.

In 2050, Viet Nam has mainstreamed Green Economic Development


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mplementation Establish an Inter-ministerial Coordinating Board for implementation o

Growth Strategy under the National Committee on Climate Change to d

implementation of the green growth strategy.

The Board will have the Deputy Prime Minister as its Head. The Minis

Planning and Investment will be the standing vice Head of the Inter-mi

Coordinating Board and four other vice-Heads are leaders of ministries

Industry and Trade, Agriculture and Rural Development, Natural Resou

Environment. Inter-ministerial Coordinating Board members include re

of some ministries, sectors and local authorities and representative of sassociations.

The supporting office for the ICB is located in the Ministry of Planning

Investment.

Establishment of Climate Finance Task Force to advise Government omechanisms;


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Key Challenges Moving from strategy development towards implementation:

Developing mechanisms for provincial and sectoral target setting requires tools/mechani

Criteria for green growth projects/ programs.

Assess investment requirements

Sources of finance (domestic vs. external)

Assessing what market based mechanisms are appropriate

Promote private sector involvement

Work on development partner coordination:

A coordination framework has been developed but needs to be rolled out

Development partners have converging approaches which hampers coordination

Limited understanding at local level.

Despite significant identified win-win potential the upfront investment costs remain significant fodemands new financing mechanism.

Uncertainty on climate finance and green climate funds limits midto longer term commitments


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Climate Finance in Viet Nam

Government investment for Climate Change projects and program of around $1 annually.

Viet Nam has received International Climate Finance support under the form of ODA from 1993 o

Almost all CFs are for adaptation purpose;

Funding channels: SPRCC, REDD+, VEPF, CDM.

Assessing existing expenditures on climate and green growth [will provide more detail and acc

UNDP and WB supported Climate Public Expenditure and Investment Review (has been initiated).

Improving access to climate finance:

Establish the Vietnam Climate Finance Options Framework (inception workshop March 26 );

In collaboration with UNEP and Frankfurt School of Finance and Business develop green growth/climmechanisms;

MPI DSENRE is a member of the Steering Committee for the Asia Low Emission Development StraForuma partner network of the LEDS Global Partnership.

Work with sectors and provinces to set targets and identify policy actions and investments:

Work on developing the MACC (Marginal Abatement Cost Curve) findings into investments and pol

Develop synergies between existing work at sectoral level (agriculture and rural development, renewaindustry strategy)


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VGGS requires a broad based funding stra

- Engagement of private sector, as investor and as recipient:

Building on PPP modalities work on blending CF/Green finance sosector investments in infrastructure, power generation;

Develop new modalities to facilitate innovation through subsidizing pwhich engage private and public sector partners.

- Use the Budget as entry pointenlarging fiscal space to allow public invegrowth.

- Develop market based mechanism to generate financing for green grosupport):

NAMA development (credited/performance based);

A future cap and trade system (probably initiated through sector baemission allocations).


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Proposed Roadmap

2012------------------2015------------------2020-------------------2025-----------------------203

Learning

On GG,

identify win-

wins

Climate finance master

plan

Develop financial infrastructure and market based mechanism (new

mechanism/NAMA)s

Mainstream GG in

(SEDP 2015-2020

GGS

Gradual sharpen targets through cap

and trade, increased and targeted env

taxes,

Initiate innovation in Green Supply Chains

Develop Human resources and technology for GG

DevelopMRV

Phases: Learningmain-streaming-Green Growthtowards a GEgreen Viet Nam

GGS

1. Lo

grow

2. Gr

produ

3. Grlifesty

Green public Procurement

IEC

Public awareness campaigns

Establish national REDD +Program

CDM

PMR suppo


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Tools and Instruments

TAX POLICIES

FINANCIAL POLICIES ON LAND

CDM POLICIES


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TAX POLICIES

Enterprises in

the domains of

high

technology,

scientific

research and

technological

developmentand Enterprises

operating in

environmental

domains

CIT: PROMOTE GREEN ENTERPRISES

are entitled

tax exempt

for no mor

than four ye

and a 50%

reduction payable ta

amounts for

more than n

subseque

years.

are entitled to

the tax rate of

10% (general

tax rate is 25%)for 15 years

since enterprise

has turnover.


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TAX POLICIES

ROYALTIES: Limit wasteful

use, especially water reso

gr

3

po

pr

Tax rate for

exploiting

surface water is

from 1% to 3%:

prevent the

depletion of

water resources

IMPORT TAX: Encourage enterprises

to invest in waste treatment sector

machines, equipment,

means, tools and

materials for exclusive

use in collection,

storage, transportation,

recycling and treatment

of wastes are entitled to

tax exemption.

machines, equipment,

means, tools and

materials for exclusive

use in environmental

observation and

analysis; generation of

clean or renewable

energy are entitled to tax

exemption


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Financial policies on land

List of domains are entitled to specialinvestment preferences:

Treatment of pollution and protection ofenvironment; production of equipmentfor pollution treatment and equipment

for observation and analysis of theenvironment;. Collection and treatment

of wastewater, waste gas and solidwaste; recycling or reuse of waste...

List of domains are entitled to specialinvestment preferences:

Manufacture of equipment forresponding to and dealing with oil spills;Manufacture of equipment for wastetreatment.

located in geographicalareas with difficult

socio-economicconditions

located in geographicalareas with exceptionallydifficult socio-economic

conditions.

Ao

a

1 1

3


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CDM (Clean Development Mechanism) pol

Invest in producing certain goods in "clean production - environmental protection wa

capital investments and its profit will be lower than invest in producing other goods. S

be an appropriate mechanisms and policies to encourage investment in this sector.

To encourage investment, support enterprises, the Prime Minister issued Decision date

No.130/2007/QD-TTg on a number of mechanisms and fiscal policies for projects und

development mechanism (CDM). Investors that build and implement CDM projects in

+) Exempt or reduce CIT

+) Exempt or reduce land use levy, land rents in special investment preferences domai

preference)

+) Consider subsidies for products of CDM projects in Vietnam


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Next steps

Roll out the 10 priority programs (including the financing)

Design the VGGS Implementation Plan, obtain approval and roll out of the priority achalf of 2013) which includes low carbon policy instruments.

Coordinate interested Development partners based on aid effectiveness principles.

Building capacity for Climate Finance Fask Force

At provincialand sectoral level, awareness and understanding remains limitedreq

capacity building investments.

Develop an overall climate/green growth finance mechanism to start working towardsassessing the Green Climate Fund.


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Thank you for your attention!

session ii - 1 - vietnam - by ms trinh and ms nhung

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