On September 21, 2023, the State Bank of Vietnam (SBV), in coordination with the International Finance Corporation (IFC), the Swiss Secretariat for Economic Affairs (SECO), and the Australian Department of Foreign Affairs and Trade (DFAT), organized a thematic Seminar on "Greening the financial sector - Accelerating transition to a low-carbon economy in Vietnam".
SBV Deputy Governor Pham Thanh Ha speaks at the Seminar
The Seminar was organized within the framework of the implementation of the Memorandum of Understanding on the development of a green and sustainable banking sector, contributing to the implementation of Vietnam’s commitments made at the 26th UN Climate Change Conference of the Parties (COP26), which was signed by the SBV and the IFC in May 2022.
In his opening speech, SBV Deputy Governor Pham Thanh Ha affirmed that green growth and sustainable development have become an inevitable trend and a goal that every country is aiming for. Vietnam is one of the countries facing many environmental problems, and is heavily affected by climate change. That has put negative impacts on the economic development and the people's livelihoods. Over the past time, Vietnam has actively participated in implementing the international commitments focusing on reducing the greenhouse gas emissions, mitigating the impacts of climate change, aiming for the attainment of the sustainable development goals, as committed in the 2030 Agenda for Sustainable Development; signed the Paris Agreement on climate change; committed to achieving the goal of bringing net emissions to zero by 2050 at COP26.
The SBV Deputy Governor emphasized that the banking sector is an important channel for providing capital to the economy, and the SBV always recognizes its role and responsibilities for "greening" the investment capital flows for sustainable development. Together with the whole country, the banking industry has been proactive and creative towards achieving the goals as set by the Government in the National Green Growth Strategy for the 2021-2030 period, Vision to 2050, and has obtained encouraging results, such as the approval of the Scheme on the development of green banks in Vietnam, the formulation of the Action Program of the banking sector to implement the National Green Growth Strategy; the development of Circulars on the environmental and social risk management in the credit granting operations, with the purpose of gradually increasing the proportion of green credit outstanding balance for the economy.
At the Seminar, the IFC climate finance specialists presented many analytical and statistical data on the potentials for climate investment opportunities in the emerging markets. Accordingly, it is expected that from now until 2030, these markets would need to attract USD 23 trillion of climate finance, focusing on construction projects, transportation and renewable energy. In Vietnam, according to the World Bank’s estimates, from now until 2040, the country would need an additional investment of USD 368 billion, equivalent to about 6.8% of Vietnam’s GDP per year, for the roadmap of increasing the resilience and achieving “net-zero” emissions. The statistics also shows that climate finance in Vietnam is still at an early stage (in 2020, climate finance only accounted for about 0.5% of the total credit of Vietnamese banks, or about 0.2% of the GDP), and thus there are still many opportunities for the credit institutions to explore and exploit in the field of climate financial products. At the Seminar, the specialists also provided some reference information about the green transition roadmaps for the commercial banks in several countries, including China, the Philippines, Thailand, Turkey, etc.
As a follow-up activity after the Conference on "Attracting resources to support green growth and the implementation of the sustainable development goals" organized by the SBV in August 2022, this Seminar was expected to become an annual event of the banking industry with the objective of promoting the role of green credit, making an important contribution to the acceleration of green growth and sustainable development in Vietnam.
Some photos of the Seminar
Le Hang