Vietnam has made significant progress in developing its carbon market as part of its commitment to achieving net-zero carbon emissions by 2050. The issuance of Decree No. 06/2022/ND-CP has laid the foundation for a domestic carbon trading system, focusing on the regulations for carbon credit management and trading activities. However, experts note thatViet Nam needs to address several issues to operate the carbon market effectively.
Urgent need for workforce training
According to analyses from domestic and international experts, the human resources for the carbon credit market are lacking both in quantity and quality. This is a major challenge forViet Nam as it participates in the global carbon credit market.
Vietnam plans to pilot the formation of a carbon credit exchange in 2025. Experts suggest that initially, around 150,000 professional workers need to be trained. This workforce should be equipped with knowledge to understand the mechanisms for validation, related documentation, carbon credit declaration, and assessment. Training carbon auditors with expertise and international certification is a key link that will helpViet Nam operate its carbon credit market.
Professor Vo Xuan Vinh from the Institute of Business Research stated that developing specialized human resources in the field of carbon credits is crucial. Training programs and support services for the carbon credit market not only provide knowledge and skills but also ensure effective participation byViet Nam in this market. Therefore, continued investment in training, expanding international cooperation, and developing related services are necessary forViet Nam to fulfill its international commitments while taking advantage of opportunities in the carbon credit market, contributing to global emission reduction efforts and promoting sustainable development.
To train a specialized workforce for the carbon market,Viet Nam needs to invest in training and developing experts capable of performing complex tasks such as measuring, reporting, and verifying emissions.Viet Nam can learn from programs like those offered by Verra, which provide in-depth training on how to apply international standards to carbon projects. This will helpViet Nam build a team of experts capable of evaluating and developing high-quality carbon projects, as recommended by experts.
Compliance with International Commitments
According to Professor Claudio Dordi, Director of the Digital Trade Project at the United States Agency for International Development (USAID),Viet Nam still faces challenges that need to be addressed, particularly in complying with international commitments.
Specifically, Professor Claudio Dordi highlighted the importance of the legal framework. AlthoughViet Nam has proactively introduced policies to support carbon trading, they remain fragmented and lack comprehensiveness. The current policy framework is not fully aligned with international standards for carbon credit trading, creating uncertainty for businesses wanting to participate. Without clear guidance on how to calculate emissions reductions or the procedures for international carbon credit trading, companies may be hesitant to invest, emphasized the USAID expert.
Secondly, regarding Measurement, Reporting, and Verification (MRV), Mr. Claudio Dordi noted thatViet Nam's MRV system needs significant improvement. Currently, it does not align with international best practices, which could undermine the credibility ofViet Nam's carbon credits in the global market. Accurate MRV is crucial to ensure that emissions reductions are real and verifiable.
The third issue thatViet Nam needs to address, according to Professor Claudio Dordi, is Carbon Rights and Benefit Sharing. There is a lack of clarity regarding carbon rights and a fair benefit-sharing mechanism. This uncertainty could lead to conflicts over land use and hinder local community participation in forestry projects. Without clear guidance on ownership of carbon credits generated from forest conservation efforts, local communities may feel excluded from potential economic benefits.
Capacity building is the fourth issue thatViet Nam should pay attention to. In reality, many businesses inViet Nam still lack awareness and understanding of how to effectively navigate the carbon market. Without sufficient resources and training, companies may struggle to participate effectively in carbon trading activities. Initiatives to educate stakeholders about the benefits and mechanisms of carbon trading are essential to promote active participation.
Fifth, integration with the international market:Viet Nam's current system lacks integration with the international carbon market, limiting opportunities for businesses to engage in global transactions.