HCM City (VNS/VNA) – Ho Chi Minh City needs to adoptpolicies and channel financial resources to develop a carbon creditmarket in an effort to cut greenhouse gas emissions and respond to globalwarming, experts said.

Speaking at a seminar on February 29, Dr. Su Dinh Thanh, Directorof the University of Economics HCM City, the event’s organiser, said it wasvital for the city to establish a carbon credit market to shape standardsand trends for other localities to promote the carbon market.

“The establishment of a carbon credit market will creategreen financial resources for technological innovation enterprises in thecity,” Thanh said.

The city is preparing for a pilot phase of carbon trading, whichis set to begin in 2025, with full operations expected to commence in 2028.

The carbon market is expected to attract investment inrenewable energy, environmental technology, and international climatefinance. 

It will also promote a green economy and create new jobopportunities while enhancing the city’s international reputation in climatechange mitigation efforts.

Within Southeast Asia, only Indonesia has implemented a mandatorycarbon market for the energy sector. 

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As a dynamic and fast-growing city, HCM City is facing variousenvironmental challenges, particularly air pollution, with annual carbonemissions exceeding 60 million tonnes, accounting for over 20% of thenation's emissions. 

Dr. Nguyen Thi Tuyet Nhung, a research group member onthe carbon market at the University of Economics HCM City, said thecity needed to exploit specific mechanisms and policies throughthe National Assembly to reduce greenhouse gas emissions andrespond to climate change.

Resolution 98 allows the city to pilot a financial mechanism formeasures to reduce greenhouse gas emissions via the use of the city’s budgetfor carbon credit exchange, according to Nhung.

These mechanisms enable the city to control environmentalpollution, attract sustainable investments, generate revenue and funding forenvironmental projects, and fulfil international commitments on emissionreduction.

Moreover, voluntary development of the carbon market will help thecity generate significant revenue through issuing and selling carboncredits and from emission reduction projects using abundant energy sources suchas solar, wind, and waste.

Hoang Le Nam Hai, another research groupmember on the carbon market at the University of Economics HCM City,said the carbon market would create opportunities to attract investment inrenewable energy, environmental technology, and international climate finance.

It would also promote a green economy and create new jobs whileenhancing the city’s international reputation in climate change mitigationefforts.

HCM City has set a target of reducing emissions by 10 per cent by2030 and moving towards a low-carbon economy, with the possibility of a 30%reduction. 

Experts also recommended the city equip businesses and thecommunity with knowledge while enhancing awareness of the carbonmarket.

It also needs to implement policies to encourage and supportbusinesses in voluntarily setting emission reduction targets, and engaging incarbon credit transactions to offset their emissions.

Vietnam plans to officially run a carbon trade exchangein 2028 under a project conducted by the Ministry of Natural Resources andEnvironment.

Under the scheme, Vietnam will pilot the operation of thiscarbon credit market in 2025 to connect and exchange carboncredits with regional and international markets.

From now until the end of 2027, the country will focuson developing regulations on carbon credit management and the exchange ofgreenhouse gas emission quotas and carbon credits.

The operation of the carbon trade exchange contributes toreducing greenhouse gas emissions under previous climate commitments,especially the goal of Vietnam to reduce net emissions to zero by2050 under the COP26.

A carbon credit is a kind of permit that represents one tonne ofcarbon dioxide removed from the atmosphere.

They can be purchased by an individual or, more commonly, acompany to make up for carbon dioxide emissions that come from industrialproduction, delivery vehicles or travel./.