The next generation green economy

International support is pouring from several fronts, helping Vietnam on its way to becoming a green economy
photo: GE

United Nations Resident Co-ordinator and United Nations Development Programme (UNDP) Resident Representative Pratibha Mehta told the Ministry of Planning and Investment (MPI) at a recent meeting that Vietnam would embark on the next generation of its Socio-Economic Development Strategy for 2015-2020, setting the stage to make green investment choices an integral part of the nation’s development priorities.

“The UNDP is committed to accompanying Vietnam on its green growth path and to help seize green investment for the opportunity that it is,” she said.

The UNDP in Vietnam, the US Embassy to Vietnam and the MPI have kicked off a common project to promote green growth and sustainable development through institutional capacity building. This $4.13 million project will be deployed between 2015 and 2018.

“Through provincial and city-level green growth action plans, the project will assist the MPI to support the efforts of small- and medium-sized enterprises to take advantage of new green investment opportunities, offer training to government officials, and encourage green business activity and jobs,” Mehta said.

“The project will support the MPI and other ministries to examine a range of fiscal tools and market-based instruments to strengthen the investment climate for adoption of cleaner technology and green investments in the transportation sector,” she added.

The MPI will review the country’s investment policy framework and work with the Ministry of Finance to identify gaps and potential for reforms that will accelerate Vietnam’s transition towards a greener economy. Together with the Ministry of Transportation, the MPI will review incentives for investment in energy-efficient transportation networks.

Mehta said Vietnam has given evidence of its foresight and strong political commitment clearly by the release of its Green Growth Strategy in 2012, and its Green Growth Action Plan in 2014.

“Vietnam is in the vanguard of countries taking a leadership role. Since Vietnam’s emergence as an early adopter of the global green growth agenda, the UNDP has been a steadfast partner of the government, and will continue to support its efforts to implement its green growth policies,” she stressed.

Last month, The European Union (EU) and the Ministry of Industry and Trade signed an agreement on reinforced co-operation in the field of sustainable energy.

The agreement followed the EU’s commitment to grant Vietnam €346 million ($449.8 million) to support the country’s sustainable energy development agenda, which has been selected as one of the two focal areas of EU’s development co-operation in Vietnam for 2014-2020.

Pham Hoang Mai, head of the MPI’s Department of Science, Education, Natural Resources and Environment, said Vietnam’s green growth journey had been receiving substantial support not only from the UNDP and the EU, but also from many other partners including the US Agency for International Development, Korea’s International Co-operation Agency, GIZ, the Danish International Development Agency, Belgium, the Asian Development Bank and the World Bank (WB).

The Global Green Growth Institute and the UNDP are supporting Vietnam in making a guideline for green growth investment. Additionally, the WB and UNDP are also helping Vietnam to conduct its first Climate Public Expenditure and Investment Review to map out resources and strengthen implementation of the country’s green growth strategy.

Since 1993, Vietnam has received about $11 billion in official development assistance in the form of climate change-related projects and programmes as well as budgetary support.

During her visit to Vietnam last August, WB Group Vice President and Special Envoy in charge of Climate Change Rachel Kyte said the WB would continue to support Vietnam in boosting its green growth and development of a low-carbon economy, by bringing in both global knowledge and financing.

Currently, the WB is assisting Vietnam in developing a low-carbon economy via many projects, such as the $500 million transmission efficiency project, the $50 million industrial pollution management project, the $202 million renewable energy development project, and the $150 million managing natural hazards project. Among those, the renewable energy development project for Vietnam aims to increase the supply of electricity to the national grid from renewable energy sources on a commercially, environmentally, and socially sustainable basis. Meanwhile, the project on natural hazards management is aimed to increase the resilience of the people and economic assets in selected river basins of the project provinces within the overall framework of Vietnam’s national disaster prevention, response and mitigation strategy towards 2020.