Visitors at a mangrove forest in southwestern Viet Nam. (Photo: Nam Anh)

According to the roadmap for establishing and developing the carbon market in Viet Nam, Viet Nam will begin piloting the carbon market from June 2025 to 2028. During this phase, carbon credits will serve as the primary commodity, traded on a state-managed exchange platform.

Effectively tapping into advantages

In essence, carbon credits are assets representing the right to emit one tonne of carbon dioxide or equivalent greenhouse gases. On the international market, carbon credits under Article 6.2 of the Paris Agreement have the highest value, while voluntary credits range from 0.25 to 30 USD per credit, depending on standards and environmental benefits.

Viet Nam has been assessed by experts and international partners as one of the countries with great potential for reducing greenhouse gas emissions and creating carbon credits. To date, Viet Nam has had over 300 programmes and projects registering to implement carbon credit standards, with approximately 150 programmes and projects issued more than 40 million carbon credits, and actual trading has taken place on the global carbon market.

Recently, Viet Nam has seen many more renewable energy projects implemented in accordance with carbon credit standards. In the forestry sector, Viet Nam has traded 10.3 million tonnes of carbon dioxide as a result of emission reductions from forests in the North Central region. The project to cultivate one million hectares of high-quality, low-emission rice aligned with green growth in the Mekong Delta region also shows great promise.

From a local perspective, Viet Nam is witnessing significant development in the carbon credit trading sector. Currently, 23 localities have carbon storage services available, while six localities have been licensed to trade carbon credits, including: Thanh Hoa, Nghe An, Ha Tinh, Thua Thien Hue, Quang Binh and Quang Tri.

Many localities with forest advantages have already made or are making careful preparations to participate in the carbon credit market. For instance, Yen Bai has 433,600 hectares of forest, of which natural forests account for over 245,580 hectares, planted forests over 188,000 hectares, and has basically formed specialised planted forest areas for processing both within and outside the province.

According to calculations by scientists, if planted forests can absorb 15 cubic metres/ha/year, then the total amount of carbon dioxide absorbed by natural and planted forests in Yen Bai Province is over 4.7 million tonnes per year. Assuming that all carbon absorbed by timber forests and natural forests is monetised on international markets at the lowest price of approximately 5 USD per tonne, then Yen Bai’s annual carbon credit value could reach nearly 550 billion VND (21 million USD).

Quang Binh Province also has advantages with over 590,000 hectares of forest, of which over 469,000 hectares are natural forests, with forest coverage reaching 68.7% and relatively good forest quality. During the 2023-2025 period, the province received 235 billion VND (8.9 million USD) from carbon credit sales, providing income for nearly 11,000 forest owners, and contributing to sustainable forest management and protection.

Ca Mau is also a locality with a large mangrove forest area. It is estimated that each hectare of forest can absorb hundreds of tonnes of carbon, which can be sold at 5 USD per credit. For other provinces such as Ha Tinh, Nghe An, and several provinces in the North Central region, this opportunity is also an important lever to promote sustainable development, support greenhouse gas emission reduction, and protect the environment.

According to analysts, Viet Nam’s forests can generate approximately 50-70 million tonnes of surplus forest carbon credits, bringing in thousands of billions of VND in revenue if successfully exported. Previously, in 2023, Viet Nam’s forestry sector successfully sold 10.3 million forest carbon credits (equivalent to 10.3 million tonnes of carbon dioxide) through the World Bank. At a unit price of 5 USD per tonne of carbon dioxide absorbed, the total contract value amounted to 51.5 million USD.

Promptly completing the legal framework

Assessing the economic value of carbon credit trading, Associate Professor Do Anh Tai, Deputy Director of the Institute of Economics and Development, stated that historically, localities only focused on developing sectors such as industry, agriculture, or services. However, not every locality has advantages in these sectors.

“Localities with forest advantages or coastal localities can immediately consider building strategies to tap into potential from carbon credit trading. If done well, the economic benefits could far exceed many other sectors. Moreover, this value is dual value, not only economic but also environmental,” said Associate Professor Do Anh Tai.

He noted that as many localities are restructuring their economies and as decentralisation increases, integrating carbon credit market development strategies into socio-economic development plans is essential.

Sharing this view, economist Nguyen Manh Hai also stated that localities actually have great potential, but awareness and understanding of this sector remain limited. Therefore, the most important thing at present is to complete the legal framework comprehensively and systematically, from top to bottom.

“When there is a complete legal system, localities will be more proactive in participating in this sector, properly utilising their potential and advantages.”

According to Luong Quang Huy at the Department of Climate Change under the Ministry of Agriculture and Environment, there are considerable technical and legal challenges, as well as awareness issues. Many localities still understand that they can sell as many credits as they have hectares of forests. Greater efforts are needed to increase carbon dioxide absorption, before considering credit sales.

Therefore, experts all believe that for the carbon credit market to operate effectively, close coordination between ministries, sectors, and localities is needed to complete institutional frameworks, standardising emission data, and enhancing capacity for enterprises.

This will not only help Viet Nam reduce emissions to achieve the net zero target by 2050, but also open up new financial opportunities, enhancing the competitiveness of localities in particular and the country as a whole in green economic development.