Vietnam State Bank promotes carbon market to boost green credit

At a recent workshop regarding credit policy and the carbon market, Nguyen Ngoc Canh, Deputy Governor of the State Bank of Vietnam, highlighted the complementary relationship between green credit and carbon markets. He noted that an effective carbon market can transform emission reduction results into financial resources, helping businesses diversify funding and reduce reliance on bank loans.

To support Vietnam’s COP26 commitment of net-zero emissions by 2050, the government has established frameworks to promote green growth. A pilot carbon market is set to begin with an allocation of over 511 million tons of CO2 equivalent for the thermal power, steel, and cement industries during the 2025–2026 period. This pilot phase will continue through 2028 before full mandatory operation begins in 2029.

Green credit provides the initial capital for technological innovation and energy efficiency, while the carbon market creates economic incentives by assigning value to emission reductions. This synergy is expected to improve credit quality and provide businesses with the necessary liquidity to sustain their green transition.