Prime Minister Pham Minh Chinh has officially signed Decision No. 232/QD-TTg on 24 January 2025, approving the Project for the Establishment and Development of the Carbon Market in Vietnam (“Decision 232”). This is an important step aimed at encouraging businesses, organizations, and stakeholders to participate in the process of reducing greenhouse gas emissions, creating opportunities for the development of a green economy. Decision 232 not only opens significant opportunities for carbon credit trading in Vietnam but also reaffirms Vietnam’s strong commitment to fulfilling international environmental protection commitments.
Development roadmap for the carbon market in Vietnam
According to Decision 232, the carbon market will be developed in three main phases:
- Before June 2025: Gradually build and complete the legal framework and infrastructure as well as improve management capacity and operational organization for the purpose of operating the carbon market in Vietnam;
- From June 2025 to the end of 2028: Pilot implementation of a domestic carbon trading platform in parallel with the completion of the legal framework and infrastructure; and
- From 2029: Official operation of the carbon trading platform, with continued improvement of relevant laws and enhancement of management capacity.
Accordingly, the carbon market in Vietnam will consist of two main types of commodities as follows:
- Greenhouse gas emission quotas; and
- Carbon credits certified for trading on the market, including:
- Carbon credits obtained from programs and projects under the domestic carbon credit exchange and offset mechanism in accordance with the provisions of law;
- Carbon credits obtained from programs and projects under international carbon credit exchange and offset mechanisms, including:
- Carbon credits obtained from the Clean Development Mechanism (CDM);
- Carbon credits obtained from the Joint Crediting Mechanism (JCM); and
- Carbon credits obtained under the mechanism pursuant to Article 6 of the Paris Agreement.
The project will promote the participation of businesses
According to the direction of the Prime Minister, ministries, agencies, and local governments need to closely coordinate to develop a transparent and efficient carbon market that aligns with international practices. The Ministry of Natural Resources and Environment has been assigned the task of researching and developing a market management mechanism, including organizing the operation and trading of carbon credits, to encourage businesses to participate in greenhouse gas emission reduction projects. These activities will be carried out in a manner that protects the environment but does not disrupt economic development while simultaneously protecting the environment.
One of the highlights of the project is the balance between economic growth and environmental protection. Instead of viewing emission reduction solely as an obligation, businesses are encouraged to participate in the carbon market through long-term economic benefits, leveraging flexible financial mechanisms and supportive policies from the government. Specifically, the government will implement funding programs and technical support to reduce investment costs in clean technologies, while applying preferential policies on taxes, fees, and charges to encourage businesses to transition to sustainable production and consumption models.
In addition, the project also focuses on building a transparent carbon credit system, creating incentives for businesses to invest in green technologies and renewable energy. High-emission sectors such as energy, transportation, and industrial production will play a key role in this market, contributing to the realization of Vietnam’s emission reduction targets.
The ability to connect with international markets
The development of the carbon market not only helps Vietnam achieve its national emission reduction targets but also opens opportunities for deeper integration with international markets, where the value of carbon credits is increasingly rising. This project will provide a solid foundation for Vietnam to engage in global environmental initiatives, while promoting cooperation with countries that have successfully established carbon markets. These partners will play a crucial role in sharing experiences, providing technical support, and developing a carbon credit trading model that is suitable for the domestic context.
The approval of the carbon market development project marks an important step in Vietnam’s sustainable development strategy, contributing to the realization of the commitment to achieve net-zero emissions by 2050. Furthermore, this not only demonstrates Vietnam’s responsibility towards international agreements but also opens significant opportunities to promote a green economy, driving businesses to innovate technologies and enhance their competitiveness. To effectively harness this potential and establish a solid foundation for Vietnam to gradually integrate into regional and international carbon markets, businesses, regulatory agencies and the public must also proactively adapt and take advantage of the benefits from carbon trading to move towards a sustainable growth model.
The above is not official advice from BLawyers Vietnam. If you have any questions or suggestions about the above, please contact us at info@blawyersvn.com. BLawyers Vietnam would love to hear from you.
Date: 16 September 2025
Writer: BLawyers Vietnam
