Special edition  » Green development

Japan is ready to give further support to Vietnam in its fight against climate change and its path towards a green economy, Japanese ambassador to Vietnam Mitsuo Sakaba tells VIR’s Binh Chau.

What is the focus of the Japanese government’s assistance to Vietnam in developing a low carbon economy and what has Japan done in this field of cooperation?

Mr Mitsuo Sakaba

First of all, we should keep in mind that according to the World Bank’s 2007 report, Vietnam is one the five countries which can be most seriously affected by climate change because of sea level rises. Although Vietnam is still small emitter, it had a very high increase in CO2 emissions by around 5.5 times from 1990-2006 (+12 per cent per year) and its energy consumption also went up remarkably, by around five times during this period.

We have taken into account these factors in our cooperation policy towards Vietnam and we decided to focus on the areas of renewable energies, energy saving technologies, low-carbon society building, especially in public transportation and waste management.

So far, we have been working with the Vietnamese government to adopt master plans in the fields of renewable energies and energy saving technology. We are working with the government on incentive measures for public and private enterprises which introduce these energies or technologies in their production process.

We are also working on a draft law covering the economical and efficient use of energy which will be submitted to the National Assembly. This new law is important to promote energy saving technologies and we hope the National Assembly will soon approve the new law. In this context, we are also cooperating with the Ministry of Industry and Trade (MoIT) to establish a training centre for energy saving technologies in form of technical assistance to Vietnam. This centre is designed to train energy managers who, after getting trainings, will be sent to factories to assess the energy saving technologies there, giving advices to the factories and providing some know-how. We believe that this kind of energy managers should be increased in number so that energy saving technologies will be further promoted.

Also, last November, we agreed a $50 million official development assistant project to support Vietnam in the fields of renewable energies and energy saving technology. As agreed by the two governments, the Vietnam Development Bank (VDB) will use this money to provide loans with preferential interest rates to companies that want to introduce renewable energies or energy saving technologies. At the moment, we are inviting companies to present their requests to the VDB for loans for their projects and we are particularly waiting for good projects in cement, steel and food processing sectors which are the largest energy consumers of the Vietnam’s economy. With the annual interest rates of round 5 per cent for dollar loans and 6-7 per cent for dong loans, we hope that the loans will be a good incentive for Vietnamese companies to adopt green technologies.

Japanis now one of the largest foreign investors in Vietnam. What do you think of Japanese investors’ awareness and efforts in protecting the environment in Vietnam?

I can tell you two things. The first is that environmental standards applied by Japanese companies operating in Vietnam are one of the toughest in the world. As we suffered a lot environmental problems in 1970s to 1980s, the Japanese government introduced very strict measures to control this issue. Most Japanese companies which invest in Vietnam have been applying basically the same criteria that they do in Japan. So I can say that Japanese manufacturers are applying very strict environmental criteria.

The second point is that Japanese companies pay great attention to the introduction of internationally recognised environmental management standards like ISO14000. In fact, almost all Japanese companies in Vietnam have set up this ISO system and many have also voluntarily adopted solid waste or water treatment criteria at a very high level while this is not always the case of other investors in Vietnam.

Vietnamalready has set up enough legal frameworks for environmental protection, but it is a fact that law enforcement is not effective and efficient enough, allowing many companies not to respect the laws. I hope that the central and local governments of Vietnam will do more in terms of law enforcement and implementation.

Are you afraid that Japanese investors will copy the poor practices of other companies in Vietnam to save on production costs?

Of course it is not fair that while other companies do not respect the laws, Japanese companies spend a lot of money in meeting environmental standards which may make their products less competitive. However, I do not think Japanese companies will lower environmental standards for that reason. When mother companies in Japan apply high environmental standards, their subsidiaries and branches in Vietnam are required to do the same.

Vietnam has a strong demand for investment projects to enable the country to achieve green growth with renewable energy, waste treatment and energy efficiency projects. What do you think of Japanese investors’ interest in these areas of cooperation?

Japanese companies have a growing interest in environmental projects in Vietnam, particularly in developing solar energy or in reusing and recycling energy. Our companies are also interested in introducing energy saving technologies and appliances. Companies such as Panasonic, Sanyo and Sony want to introduce energy saving home appliances and an energy saving rating system in Vietnam, which is now popular in Japan, on an experimental basis in order to increase consumers’ awareness of saving energy and being familiar with energy saving appliances.

Energy saving home appliances and rating systems are new concepts to most Vietnamese people. Does Japan have a plan to give assistance to Vietnam in this field?

Recently in late May, we agreed to provide Vietnam with a $105 million loan to support the implementation of Vietnam’s National Target Programme on responses to climate change in various aspects. By using this loan, I hope the Vietnamese government will map out incentive measures to promote energy saving home appliances.

Can Vietnam expect further Japanese overseas development aid (ODA) loans for its environmental protection? 

I think so. It is considered that the $105 million ODA loan for climate change is just the first package. It means that there may be a second package in the future. But, we are not discussing another new package yet. Maybe during the implementation of the national target programme, more money will be needed and the Japanese government is ready to further support Vietnam in its fight against climate change and its path towards a green economy.