More incentives needed to support green credit: Experts
Experts have shared a view that green credit and green growth play an important role in implementing the National Green Growth Strategy in the 2021-2030 period with a vision until 2050 as they create resources for environmentally-friendly projects and programmes.
Green credit and green growth play an important role in implementing the National Green Growth Strategy in the 2021-2030 period with a vision until 2050. (Photo: nhandan.vn)
Hanoi (VNA) – Experts have shared a view that green credit and green growth play animportant role in implementing the National Green Growth Strategy in the2021-2030 period with a vision until 2050 as they create resources forenvironmentally-friendly projects and programmes.
Dr. Nguyen Quoc Hung, Vice President and General Secretary of the Vietnam BanksAssociation, said the banking sector has worked hard to achieve targets set bythe government in the strategy.
The State Bank of Vietnam (SBV) has issued many credit documents in accordancewith the goals of environmental protection and carbon emission reduction,towards green growth, he said, taking the examples of Directive No. 03/CT -SBVdated March 24, 2015 on promoting green credit growth and managingenvironmental and social risks in credit granting, along with the action planof the banking sector to implement the strategy until 2020.
Most recently, the central bank issued Circular No. 17/2022/TT-NHNN datedDecember 23, 2022 guiding environmental risk management in credit granting byforeign credit institutions and banks in Vietnam, he continued.
"It can be said that the legal corridor in Vietnam has been graduallyconsolidated to facilitate green credit and green banking," Hung affirmed.
Illustrative image (Source: tapchitaichinh.vn)
Credit institutions have also joined such efforts, he said, citing statisticsby the SBV's Department of Credit for Economic Sectors showing that as of June30, outstanding green credit loans reached nearly 528.3 trillion VND (21.5billion USD), accounting for about 4.2% of the total outstanding debt of theentire economy, mainly in renewable energy, clean energy and green agriculture.
However, Hung said, potential for green credit in Vietnam has remained fullyuntapped, further explaining that the process has faced hindrances in terms ofresources, knowledge and experience of bank employees, and sluggishness in theissuance of internal regulations by some banks.
Tran Anh Quy, Head of Policy Credit at the Department of Credit for EconomicSectors, pointed to the lack of a national green list that would serve as afoundation for capital mobilisation.
Moreover, credit institutions have found it hard to balance loans as greenprojects need big investments and long payback periods, and face high risks, givenlimited support mechanisms and policies, he went on.
To untangle such knots, many proposed the government, the central bank andmanagement agencies further consolidate the legal corridor, and soon issue thegreen list.
Quy emphasised that the SBV will continue with solutions and policies topromote banks’ activities towards green growth, thus contributing to economicrecovery./.
The Ministry of Agriculture and Rural Development (MARD) is planning to coordinate with the State Bank of Vietnam in completing policies on preferential credit to support agricultural projects following value chains, applying high technologies and specialising in clean agriculture and production forest planting.
Commercial banks in Vietnam have been actively offering loans for green projects and expanding green credit through mobilising capital from international credit institutions.
Vietnam’s green credit balance accounted for about 4.2% of the economy’s total credit balance by June 30, 2023, according to the State Bank of Vietnam (SBV).
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Green credit and green growth play an important role in implementing the National Green Growth Strategy in the 2021-2030 period with a vision until 2050. (Photo: nhandan.vn) 
Illustrative image (Source: tapchitaichinh.vn) 
