Ho Chi Minh City (VNA) – With its large business base, Ho Chi Minh City has significant demand for emission allowances and carbon credits, while further improvements are needed in regulatory mechanisms, data systems and verification capacity to facilitate business participation.

Improving mechanisms, removing bottlenecks

Deputy Minister of Agriculture and Environment Le Cong Thanh said Vietnam is shifting from policy development and refinement to the implementation and operation of the carbon market. The domestic carbon exchange began pilot operations on June 29, 2026, providing a platform for trading greenhouse gas emission allowances and carbon credits.

The policy framework for greenhouse gas emissions reduction and carbon market development is now basically in place. Authorities will continue improving systems for measuring, reporting and verifying emissions reductions, data management and technical requirements to ensure transparent and effective market operations.

In Ho Chi Minh City, a large number of businesses are subject to greenhouse gas inventories. Nguyen Hong Nguyen, Deputy Director of the municipal Department of Agriculture and Environment, said that under Decision No. 42/2026/QD-TTg issued by the Prime Minister on August 10, 2026, 479 businesses in the city are required to conduct greenhouse gas inventories. Earlier, 16 thermal power and steel businesses had been allocated pilot emission allowances for 2025-2026. Depending on their emissions reduction results, these businesses may have demand for buying or selling allowances and carbon credits.

To prepare for the market, the department advised the municipal People’s Committee to announce seven administrative procedures in climate change and three in forestry and forest protection that have been decentralised to provincial-level People’s Committee chairpersons. This provides a basis for the city to process applications when businesses have relevant needs.

Ho Chi Minh City has proposed clarifying mechanisms for a private-sector carbon credit exchange, licensing requirements and connections with the national registration system. It has also called for the publication of a list of eligible carbon credit verification bodies by sector to help businesses select suitable providers.

Regarding the initial listing price of carbon credits generated by projects using public assets, Nguyen said specific guidance is needed to provide a basis for implementation. The city also proposed clarifying the rate of credit transfer and the share of emissions reductions eligible for conversion into credits for projects outside priority and encouraged sectors.

Thanh said authorities will continue reviewing and improving policies, technical infrastructure, measurement, reporting and verification systems and data management during the pilot phase, while strengthening dialogue with businesses to identify emerging difficulties.

Businesses need to improve project quality

Nguyen Ngoc Tung of VinaCarbon Fund under VinaCapital said credit quality and the ability to demonstrate genuine emissions reductions are crucial for businesses seeking access to financing. Emissions reduction activities should be developed into measurable, verifiable assets capable of generating economic value.

Emissions reductions must be real, measurable and verifiable, with the additionality of projects demonstrated and no double counting or selling of the same reduction. Projects should be sustainable and generate revenue from business activities, while land-use rights and rights to carbon credits must be clearly established.

Measurement, reporting and verification (MRV) systems must provide clear, traceable data, transparent calculation methods and independently verified results. Investors also consider economic efficiency, regulatory clarity, implementation capacity and scalability. Businesses should therefore focus on developing high-quality emissions reduction projects that can generate revenue and be properly verified, rather than simply estimating how many credits they could sell.

Among Ho Chi Minh City businesses, preparedness for the carbon market varies. Le Chau Hai Vu, a sustainable development specialist and Director of business consultancy ConsulTech, said some large businesses, particularly exporters, have begun measuring emissions and adopting international standards, while most small and medium-sized enterprises are still learning about the market.

Current challenges include standardised emissions data, upfront costs, market knowledge and business support systems, he said.

Preparations should begin with greenhouse gas inventories, identifying emission levels and areas of waste. Businesses can then adopt energy-saving measures, improve processes, switch fuels and gradually standardise their projects. For small and medium-sized enterprises, cooperation through industry clusters, cooperatives or value chains can help share costs and achieve sufficient scale.

Vu proposed simplifying guidance on measurement, reporting and verification; providing partial support for greenhouse gas inventories, project development and certification; and developing a domestic pool of consultants and carbon project developers./.