Vietnam confirms provinces get $41m from credit sales

Quantum Commodity Intelligence – Six Vietnamese provinces have so far raised $41 million in proceeds from carbon credit sales under the country's emission reduction agreement with the World Bank, Vietnam's Ministry of Agriculture & Rural Development confirmed this week.

"This is the first agreement on emission reduction to be successfully implemented in Vietnam, contributing to forest management and protection and improving people's lives," the ministry said in a statement.

The six north-central provinces participating in the agreement - Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri and Thua Thien-Hue - currently have more than 3.1 million hectares of land covered with forests, equivalent to 58% of their total area, it said.

"After the success of piloting payments to reduce greenhouse gas emissions in six provinces, many localities with large areas of well-protected natural forests are ready to soon implement the programme," the ministry said.

The World Bank's Forest Carbon Partnership Facility has funded projects that avoid deforestation in 15 countries, including Chile, Costa Rica, Cote d'Ivoire, Democratic Republic of Congo, Dominican Republic, Fiji, Ghana, Guatemala, Indonesia, Laos, Madagascar, Mozambique, Nepal and the Republic of Congo as well as Vietnam.

"Beyond the credits that the Forest Carbon Partnership Facility has contracted to purchase, these 15 programs are expected to generate up to 126 million credits by 2028, with approximately 24 million available as early as 2024," the bank said earlier this month.

Vietnam is planning to pilot carbon trading between 2025 and 2027, with the following year earmarked for the start of the compliance scheme, as it looks at options to help meet its Paris Agreement goals.

"To develop the carbon market in Vietnam, it is necessary to complete the legal framework for the exchange of greenhouse gas emission quotas, carbon credits and the credit exchange mechanism," the ministry said this week.