Vietnam - Climate Change - Technologies - Trade and Investment under the EUVNFTA - what you must know!

Climate Change
Technology in Vietnam
in light of
the EVFTA obligations
Support for the implementation of
the EU-Vietnam Free Trade Agreement
23rd November 2022

1
2
Technical Workshop on Climate Change
Trade and Investmentin Vietnam under the EVFTA
 Climate objectives and policies addressed in
the EVFTA and their reflection on Vietnam
laws?
 Trade and investment benefits under the
EVFTA contribute to climate change mitigation
and adaptation in Vietnam
 Trade and investment opportunities in:
 Agri-tech
 Electric vehicles
 Solar and wind power equipment
 Healthcare
 Interactive discussion and questions

SESSION ON CLIMATE
CHANGE
Trade and Investment in Vietnam under the EVFTA
PART 1

United Nations
Framework
Convention on
Climate Change
(UNFCCC)
Kyoto
Protocol
Paris
Agreement
EVFTA
COP26
Commitments
1992 1998 2016 2020 2021
(UNFCCC)established an international environmental
treatyto combat "dangerous human interferencewith
the climate system",in part by stabilizing greenhouse
gas concentrations in the atmosphere. (Article2)
Kyoto Protocol operationalizes the UNFCCC by
committing industrialized countriesand economies
in transition to limit and reducegreenhousegases
(GHG) emissions in accordance with agreed
individual targets.
Paris Agreement'sgoal is to limit
global warming to well below 2,
preferablyto 1.5 degrees Celsius,
compared to pre-industriallevels.
EVFTA contains dedicatedchapterson
Non-tariffBarriers to Trade and
Investmentin Renewable Energy
Generation(Chapter 7) and Trade and
Sustainable Development(Chapter 13).
The COP26 summitbrought parties
togetherto accelerateaction toward
the goals of the Paris Agreementand
the UNFCCC.
and their reflection on the domestic legal framework

United Nations
Framework
Convention on
Climate Change
(UNFCCC)
(UNFCCC) established an
internationalenvironmentaltreaty
to combat "dangerous human
interferencewith the climate
system",in part by stabilizing
greenhousegas concentrations in
the atmosphere.(Article 2)
2017
Vietnam submitted its 2nd
Biennial Updated Report
(BUR2) to the UNFCCC
2020
Vietnam submitted its 3rd
2014
Vietnam submitted its Initial
Third National Communication in 2020 contributes to the affirmation that Viet Nam aims to fulfill its obligations as a
party and also demonstrates the Government’s proactive commitment to respond to climate change under the
ultimate objectives of UNFCCC and the Paris Agreement.
Vietnam submitted its 1st
National
Communication to the
UNFCCC
2003
Vietnam submitted its 2st
National
Communication to the
UNFCCC
2010
Vietnam submitted its 3rd
National Communication
to the UNFCCC
2020
According to the Third Biennial updated report (BUR3) published in 2020, Vietnam has achieved 271 registered
Clean Development Mechanism (CDM) projects, ranked fourth in the world in the number of registered projects
with a total of 25,485,098 Certified Emissions Reductions (CERs) issued.
1992

Paris
Agreement
Paris Agreement'sgoal is to limit
global warming to well below 2,
preferablyto 1.5 degrees Celsius,
compared to pre-industriallevels.
Decision No .967/QD-BXD on July 24, 2020 Decision No. 891/QĐ-BNN-KHCN on March 17, 2020
The Prime Minister’s Decision No 2053/QD-TTG dated October 28, 2016
declaring Vietnam’s action plan to implement the Paris Agreement on Climate Change
(with 68 key task groups to be undertaken until 2030 )
 Develop mechanisms and policies to
encourage domestic and foreign businesses
and individuals to invest in public-private
partnerships (PPP) for disaster response and
climate change response activities and low
carbon value chain development, smart
adaptation to climate change in agriculture
and rural development.
 Enterprises are encouraged to produce
building materials, invest in construction
projects to improve technology, and strengthen
capacity for production management and
construction in order to reduce greenhouse
gas emissions.
 Mobilize domestic and international resources
to organize the implementation of GHG
emission reduction measures at enterprises
producing building materials and construction
works.
Ministry of Agriculture and Rural
Development
Ministry of Construction
2016

COP26
togetherto accelerateaction
toward the goals of the Paris
Agreementand the UNFCCC.
2021
The Prime Minister demonstrated the country’s strong commitments to reforms at
COP26 that Vietnam would reach net-zero GHG emissions by 2050.
The Prime Minister declared that “climate change response and the restoration of
nature must become the highest priority in all development decisions,” and called
for fairness and justice in the global response to climate change.
At COP26, Vietnam joined more than 100 countries in pledges to halt deforestation by
2030 and to slash methane emissions by 30% from 2020 levels in the same period.
Vietnam has further committed to ending all investment in new coal power generation,
scaling up deployment of renewable energy, and phasing out coal power by the
2040s.
These commitments go beyond those included in the Nationally Determined
Contribution (NDC) update submitted in 2020 under the United Nations Framework
Convention on Climate Change (UNFCCC).
 Ensureglobal net-zeroby 2050
and keepthe targetof 1.5 degrees
Celsius within reach
 Bring in adaptation measuresto
protectcommunitiesand natural
habitats
 Mobilize climate finance to
enable memberstates to achieve
their climate goals
 Coordination to finalize the Paris
Rulebook

COP26
togetherto accelerateaction
toward the goals of the Paris
Agreementand the UNFCCC.
2021
1
2
3
4
5
6
7
8
The Government released Notice No 30/TB-VPCP on guidance on implementation in 08 areas:
transform from fossil energy to
green and clean energy sources
reduce greenhouse gas
emissions in industries
reduce methane emissions,
especially in agricultural production
and waste treatment
encourage research, development
and use of electric cars
manage and sustainably use the
existing forest area and boost
afforestation for carbon absorption and
storage
research, produce and use building
materials and development of urban
areas in accordance with green and
sustainable development
promote and innovate communication in
order that the achieve consensus and
cooperation of the entire people and
business community with the Government
in fulfilling commitments at COP26
speed up digital transformation
in response to climate change.
 Ensureglobal net-zeroby 2050
and keepthe targetof 1.5 degrees
Celsius within reach
 Bring in adaptation measuresto
protectcommunitiesand natural
habitats
 Mobilize climate finance to
enable memberstates to achieve
their climate goals
 Coordination to finalize the Paris
Rulebook

Chapter 7
Non-tariff Barriers to Trade and
Investment in Renewable
Energy Generation
Chapter 13
Trade and Sustainable
Development
EVFTA, which took effect on 1 August 2020, is a new generation FTA between Vietnam and 27 European Union member states:
 From Vietnam's perspective, EVFTA is the second highest standard that Vietnam has signed (along with CPTPP), with commitments covering many
fields, a strong degree of liberalization and a higher level of commitment than most of the existing FTAs of Vietnam. Therefore, EVFTA is assessed to
bring significant and positive impacts to Vietnam's economy and institutions.
 From EU's perspective, the agreement with Vietnam is the second trade agreement the EU has concluded with an ASEAN member state, following
the recent agreement with Singapore. It represents an important milestone in the EU's engagement with Asia
Mitigation and
adaptation to climate
change

01
03
02
Chapter 7
EVFTA
Non-tariff
Barriers to Trade
and Investment
in Renewable
Energy
Generation
Applies to measures which affect trade and investment between the Parties related to the generation of
energy from renewable and sustainable sources.
 Refrain from adopting measures providing for local content requirements or any other offset
 Refrain from adopting measures requiring to form partnerships with local companies, unless
those partnerships are deemed necessary for technical reasons
 Ensure that any measures concerning the authorisation, certification and licensing procedures
 Ensure that administrative fees and charges imposed on or in connection with the (i) importation
and use of products and (ii) provision of services
 Ensure that the terms, conditions and procedures for the connection and access to electricity
transmission grids are transparent and do not discriminate against suppliers
 The Parties shall exchange information, regulatory experiences and best practices in areas:
(a) the design and non-discriminatory implementation of measures promoting the use of
energy from renewable sources;
(b) technical regulations, standards and conformity assessment procedures, such as those
relating to grid code requirements.
 The Parties shall promote cooperation, with respect to domestic or regional technical
regulations, regulatory concepts, standards, requirements and conformity assessment
procedures

01 03
02
Trade and sustainable development
 [...] The Parties shall cooperate on the implementation of the UNFCCC, the Kyoto Protocol and the Paris Agreement.
 The Parties shall, as appropriate, cooperate and promote the positive contribution of this Chapter to enhance the capacities of the Parties
in the transition to low greenhouse gas emissions and climate-resilient economies, in accordance with the Paris Agreement. (Article 13.6)
 Within the UNFCCC framework, the Parties recognise the role of domestic policies in addressing climate change. The Parties shall consult
and share information and experiences of priority or of mutual interest, including:
(a) best practices and lessons
learned in designing, implementing,
and operating mechanisms for
pricing carbon
(b) promotion of domestic and
international carbon markets,
including through mechanisms
such as Emissions Trading
Schemes and Reducing Emissions
from Deforestation and Forest
Degradation
(c) promotion of energy efficiency,
low-emission technology and
renewable energy

Mitigation and Adaptation to Climate Change
Chapter 7. Non-tariff Barriers to
Trade and Investment in
Renewable Energy Generation
 Cooperation with the EU can help
Vietnam to profit from the EU’s
successful experience in this sector.
 Clear rules will provide for better trade
opportunities and investor confidence.
Chapter 13. Trade and Sustainable
Development
 Article 13.6 on climate change further
underline the common commitment of
the EU and Vietnam to achieve climate
change objectives
Chapter 10. Environment
 Environment commitments which ensure
that environmental protection is upheld as
trade is liberalized and to prevent countries
from lowering environmental standards to
promote trade or attract investment:
- Combat illegal wildlife trade, illegal,
unreported, and unregulated fishing
- Conserve species at risk, biological diversity
- Take measures to control ozone-depleting
substances and marine pollution
- Work together to address climate change and
combat invasive alien species
 Article 25.10 promotes the cooperation
between countries to address
environmental matters related to climate
change
No provision or mention of
environmental protections/
climate change adaptation linked
to trade in the entire 20-chapter
document
EVFTA EVFTA RCEP

Domestic relevant laws and regulations
Legislation portfolio Executive documents
 Law on Economical and Efficient Use of Energy (2010)
 Law on Water Resources (2012)
 Land Law (2013)
 Investment Law (2020)
 Law on Environmental Protection (2020)
 Construction Law (2020)
 Law on Natural Disaster Prevention and Control (2013)
 Law on amendments to the law on Natural Disaster
Management and Law on Dikes (2020)
 Decision No. 417/QD-TTg dated April 13, 2019
 Decision No.891/QD-BNN-KHCN dated March 17, 2020
 Resolution 06/NQ-CP dated January 21, 2021
 Decision No.452/QĐ-BGTVT dated March 24, 2021
 Decision 896/QD-TTg dated July 26, 2022
 Decision No.59/QD-BTNMT dated January 10, 2022
 Decision No .888/QD-TTg dated July 25, 2022

Role of private sector in implementing climate
change adoptation policies
Government incentives and supports for enterprises
Enterprises are encouraged to invest in sectors related to climate
change:
 Producing new materials, new energy, clean energy,
renewable energy; making products with value added of
30% or more, energy-saving products
 Applying environmentally friendly measures, saving energy
in production and product quality management.
Article 15 specifies the beneficiaries of investment incentives,
including Science and technology enterprise incubators,
enterprises manufacturing and providing technologies,
equipment, products, and services with a view to satisfaction of
environment protection requirements.
Article 16 specifies the business lines given investment
incentives, in which, 4 out of 14 business lines mentioned are
belong to environmental related fields such as renewable
energy, waste treatment.
Clause 1, Article 20: The Government shall decide to apply
special investment incentives and assistance with a view to
encouraging the development of some investment projects that
exert significant socio-economic effects, such as innovation
centers, R&D centers.
Legislationportfolio – InvestmentLaw (2020)

Legislationportfolio - Law on EnvironmentalProtection (2020)
Chapter VII (Response to Climate Change) specifies
provisions, policies and programs on the response to climate
change.
- Promote the production, importation and employment of
renewable energy-driven machinery, equipment and means of
transport.
- Government provides preferential policies on the mitigation,
reuse and recycling of wastes, and generation of the energy
from wastes.
- All activities relating to the study, transfer, development and
application of technological and scientific advances for the
response to climate change shall be given priority, favor and
support from the Government
- Incentives and support for environmental protection tasks

Legislationportfolio - Construction Law (2020)
Encourages domestic organizations and individuals to apply
advanced construction science and technology, use new
construction materials, save energy and resources, protect
the environment, and respond to climate change.
Provides incentives for enterprises to invest in construction
according to planning in mountainous areas, areas with
extremely difficult socioeconomic conditions, and areas
affected by climate change.

Executive Portfolio
General objectives Tasks and solutions
Adapt to
climate
change
Reduce
greenhouse
gas
emission
Reduce vulnerability and risk posed
by climate change by improving
resistance and adaptation capacity
of natural, economic, and social
systems, re duce damage caused by
natural disasters and extreme
weather caused by climate change.
Achieve net zero emission by 2050,
positively and responsibly contribute
towards protection of global climate;
improve economic growth quality
and competitiveness.
a) Improve resistance and adaptability of natural, economic, and
social system in order to ensure sustainable livelihood
b) Reduce damage caused by natural disasters and extreme
weather caused by climate change
Set out general tasks regarding greenhouse gas emission reduction
by 2030 and 2050, and particular tasks by sectors:
 Energy sector (in terms of energy supply and energy usage)
 Agriculture sector
 Forestry and land use
 Waste sector
 Industrial processes and use of industrial products
- Decision 896/QĐ-TTg dated 26/07/2022
approvingthe National Strategy on Climate Change for 2050

Executive Portfolio
Government incentives and supports
for enterprises
- Developing renewable energy, including offshore and
coastal wind power; green hydrogen fuel, green ammonia;
energy storage solutions;
- Increase electrification, increase the proportion of electric
vehicles/equipment (building equipment, industrial electric
furnaces, electric vehicles, electrolysis of hydrogen
production);
- Implementing energy efficiency solutions in civil: improving
minimum energy performance standards; energy-efficient
buildings, green buildings
- Implementing energy efficiency solutions in the
manufacturing industry: waste heat utilization; applications
cogeneration; High-efficiency motor, inverter
The State Bank of Vietnam (SBV) shall play the leading role
in reviewing and establishing a complete legal framework for
green credit, and other mechanisms, policies and
regulations which aim to facilitate green credit growth; assist
credit institutions in accessing international aids and
concessional loans for financing green projects.
- DecisionNo .888/QD-TTg dated July 25, 2022
approvingthe Scheme on tasks and solutions to implementoutcomes of the COP26

Executive Portfolio
Executive Portfolio Government incentives and supports for enterprises
Decision No.452/QĐ-
BGTVT dated March 24,
2021
Mobilizing and attracting the participation of financial institutions, domestic and foreign enterprises to
invest, support the implementation of climate change adaptation solutions in transport.
Resolution 06/NQ-CP dated
January 21, 2021
- Guide enterprises to implement regulations on natural resources and environment in the Free
Trade Agreements (FTAs) to which Vietnam is a member.
- Strongly encourage enterprises to invest in solid waste and wastewater treatment; promote the
socialization of waste collection and treatment.
Decision 896/QD-TTg dated
July 26, 2022
- Strengthen the capacity of enterprises in accessing and participating in programs and projects
under the AirCarbon Exchange, Carbon Offsetting and the carbon market development;
- Propose policies to remove barriers for enterprises to invest in research and response to climate
change;
- Develop and apply incentive policies, and economic mechanisms to unlock social resources and
effectively mobilize financial resources of the business sector to respond to climate change;

 Vietnam's previous strategies only emphasized
strongly on mitigation Decision No. 1658/QD-TTg
dated October 1, 2021, on Approving the National
Green Growth Strategy (NGGS).
Assessment
Vietnam’s climate strategies have already rebalanced to include
policies and investments for adaptation as well as mitigation.
 National Strategy on Climate Change has set
specific targets in terms of adaptation in the
agriculture and forestry, infrastructure, and
healthcare sectors.
 Latest National Strategy on Climate Change
(Decision 896/QĐ-TTg dated 26/07/2022)
shows that Vietnam will have to invest
significantly in building resilience given the
serious impact of climate change on growth.
 Some progress has been made toward the
development of carbon pricing instruments, but such
instruments are not yet implemented at scale.
The new strategies have yet to be translated into
significant changes in Vietnam’s fiscal policy
 The authorities have demonstrated a strong
interest in using quantity-based caps in a trading
system and have started to shift subsidies from
petroleum to renewable sources, which
contributed to a private investment boom in solar
energy in 2020.
About 25 % of public capital expenditures
were fully or partially directed to adaptation,
mainly in irrigation and transport projects
(World Bank, 2022). Though promising, green
public procurement is also just in its infancy, as
existing legal and institutional frameworks need
to be aligned with international best practices.
The orientations, goals, and plans of State agencies in the field of climate change have been concretized through many legal documents, and
the engagement of the private sector during the planning process and implementation has been expanded much more in recent years.

Export of
renewable energy
equipment Direct investment in
Vietnam’s energy sector
Joint ventures and
technology sharing
How can trade and investment benefits under the EVFTA contribute to climate change mitigation and adaptation in
Vietnam's renewable energy sector, also in view of the target of zero emissions by 2050?
Energy production and distribution: Regulations and
barriers
 Policies and regulations on renewable energy production in Vietnam
 Legal and other impediments to connect to grid with renewable energy provision or feed-
in
 Trade and investment barriers
 Public procurement, non-tariff, and other barriers

Source: Data is extracted from (Vietnam Electricity National Load Dispatch Center, 2022) on April 7th, 2022
Figure 1. Historical installed capacity for electricity generation in Viet Nam
Decision No. 2068/QD-TTg dated 25
November 2015
targets to increase the total electricity production from
renewable energy sources from
 approximately 58 billion kWh in 2015 to 101 billion kWh
in 2020
 approximately 186 billion kWh in 2030 and 452 billion
kWh in 2050.
Decision No. 428/QĐ-TTg dated 18 March 2016
(The Revised PDP7)
contemplates that total installed capacity of electricity
generated:
 from hydropower sources will be up to 21,600MW by
2020 and 27,800MW by 2030;
 from wind it will be 800MW (2020) and 6,000MW (2030);
and
 from solar will be 850MW (2020) and 12,000MW (2030).
National Strategy for promoting renewableenergy development
 Due to the absence of favorable pricing arrangements, prior to 2017, solar
energy played almost no part in Vietnam’s energy strategy.
 Solar PV capacity will have grown from 86 MW in 2018 to almost 16,500
MW by the end of 2020 (191 times after three years), and tens of billions of
dollars have been invested, primarily from private finance.
 Wind capacity has also increased from only 90 MW in 2017 to over 4,100
MW by November 2021 (more than 45 times).

Report 7194/TTr-BCT dated dated November 11, 2022 - draft proposal for the National Power Development Plan for
the period of 2021 – 2030, with a vision to 2045 (Draft PDP8)
By 2030 By 2050
7,353 - 28,946 MW (rate 19.8 - 22.5%)
Hydropower 7.2 - 9.7%
Coal thermal power
Domestic gas and LNG thermal
power
Renewable energy other than
hydroelectricity*
Imported electricity
30,127 - 36,327 MW (20.6 - 29.8%) 0 MW
30,330 - 39,430 MW (24.9 - 27%)
biomass/ammonia power : 5.1 - 7.8%
LNG thermal power: 4.2 - 4.9%
21,871 - 39,486 MW (18 - 27%) 54.9 - 58.9%
4,076 - 5,000 MW (3.3 - 3.4%) 2.2 - 3%
TOTAL** 121,757 - 145,989 MW 368,461 - 501,608 MW
*wind power, solar power, biomass power...
**excluding rooftop solar power, separate load power supply and cogeneration

Investmentincentives on renewable energyproduction in Vietnam
Exemption from import taxes on goods imported for the purpose of creating fixed assets; these include
components, raw materials, supplies and semi-finished products that are not available in Vietnam and that are
needed for the project’s operation
(Article 16.11, Law on Export and Import Duties No. 107/2016/QH13 of the National Assembly dated April 6, 2016)
Exemption from corporate income tax (CIT) for the first 4 years from the date the project is put into
commercial operation, plus a decrease of 50% on taxable income amount for the following 9 years and the
incentive CIT rate of 10% for 15 years from the date of establishment.
(Articles 15 and 16, Decree No. 218/2013/ND-CP of the Government dated December 26, 2013, guiding the
implementation of the Law on Corporate Income Tax);
Exemption from land rent for the next three (03) years following an initial exemption during the construction
period. Depending on the location of the project where it is classified as areas with special difficulties, the project
may also enjoy the exemption of land rent of the project for longer period.
(Articles 19.3. Decree No. 46/2014/NĐ-CP of the Government dated May 15, 2014, regulations on collection of
land rent and water surface land).
Supported by policy reform, a general interest in the advantages of renewable energy, and other factors, expect renewables to
generate sustained interest from many businesses and investors looking to capitalize in the years to follow.

 Circular No. 16/2017/TT-BCT on project
development and standardized Power Purchasing
Agreement for solar power projects.
 Circular No. 05/2019/TT-BCT amendments to
Circular 16/2017/TT-BCT on development of solar
power projects and standard form power purchase
agreement (PPA).
 Decision No. 13/2020/QD-TTg on the mechanism
to encourage the development of solar power
projects in Vietnam.
 Circular 18/2020/TT-BCT on project development
and standardized power purchase agreements
applied to solar power projects.
 Decision No. 31/2014/QD-TTg, on support mechanisms
for the development of power generation projects using
solid waste(s) in Vietnam.
 Circular No. 32/2015/TT-BCT on project development and
model electricity sale contract applied to generation
projects using solid wastes.
 Decision 37/2011/QD-TTg on the mechanism
supporting the development of wind power
 Decision No. 39/2018/QD-TTg amendments to
Decision No. 37/2011/QD-TTg on the mechanism
supporting the development of wind power
 Circular No. 02/2019/TT-BCT on Wind power
project development and power purchase
agreement for wind power projects in Vietnam.
 Consolidated Document No. 07/VBHN-BCT on
the development of wind power projects and the
model power purchase agreement applicable to
wind power projects.
 Consolidation document 51/VBHN-BCT dated May 05,
2020, on a mechanism to support the development of biomass
power projects in Vietnam.
 Circular No. 58/VBHN-BCT dated August 19, 2020, on the
development of avoidable cost tariffs and a sample of
electricity sale contract applicable to biomass power projects.
Policy framework on each renewable energysource

Assessmenton policy framework of solar energy
The electricity output from solar power sources in 2021 reached 27,843 MW (an increase
of 158% compared to 2020), accounting for about 10.8% of the total electricity output of
the whole system.
By the end of December 2021, the total capacity of solar power reached 16,564 MW (145
concentrated solar power plants with total capacity equivalent to 8,908 MW; 7,660 MW of
rooftop solar power).
As of the end of June 2021, there are 66 farm solar power plants in operation, with a
capacity of 3,281 MWp, these projects are mainly concentrated in the provinces including:
Ninh Thuan, Long An, Binh Thuan, Binh Phuoc and Tay Ninh.
There are other factors that both investors and government authorities need to consider as Vietnam moves forward with solar energy
development:
Infrastructure shortcomings that hinder energy transmission;
There are still uncertainties regarding the future of coal.
Ground-mounted solar projects need to consider land rights. Though investors can benefit from exemptions from land-use fees
and rents, administrative processes can take time and cause significant delays.
A lot of administrative procedures required in many fields: investment and enterprise; planning; electrical connection; land; a
range of other sub-licenses, approvals, depending on each specific project.
“It takes the investor 1-2 years as the fastest period, even in many cases it takes about 3-5 years for the project to actually
connect to the electricity grid of EVN.” (Apolat Legal, 2020)

Assessmenton policy framework of wind energy
Viet Nam has a large potential for offshore wind but so far no offshore wind power plant has been
built and operated partly due to obstacles in project approval process including:
"These are just some of the barriers which must be overcome by Vietnamese authorities to bring confidence to investors, promote investment in
the offshore wind energy sector to ensure energy security, bring socio-economic efficiency as well as realize Vietnam's climate commitment". (Viet
Nam Energy Outlook Report, 2021)
complicated and unclear permitting and licensing procedures that involve many authorities;
lack of policies and guidelines related to finance and investment support mechanism;
lack of stable policy and pricing scheme for offshore wind power.
Offshore
wind
power
lack of instructions on offshore wind power development projects combined with electrolysis and fuel
production(such as hydrogen, ammonia...).
The Vietnamese Government promulgated a series of regulations for
developing wind power projects.
0
4
8
12
16
20
0
200
400
600
800
Total capacity (MW) Number of projects
Onshore
wind
power
Source :EVN, 2021
By the end of December 2021, 84 wind power plants with a total
capacity of 3980.27MW in the national power system have been
accepted for commercial operation (COD) (EVN, 2021) and receive
preferential pricing under Decision 39.
However, since Decision 39 has expired (after November 1st, 2021),
there has not been a clear resolution by the Government

`
Grid congestion and lack of comprehensiveplanning
4700.0
9581.0
5695.0
6866.0
6866.0
-
3000.0
6000.0
9000.0
12000.0
15000.0
18000.0
2018 2019 2020 2021
Thousand
KW
Rooftop Utility Scale Limit for Vietnam's smooth grid integration in 2020
Vietnam Installed Solar Capacity 2017 -
2021
Source: ICUN.org (2022)
The signed Connection Agreements of the National Power Transmission Corporation (EVNNPT), a subsidiary of EVN, with plant investors are carried out under
Circular 25/2016/TT-BCT (“Circular 25”), of the MOIT and internal rules of EVN.
 EVNNPT is responsible for investing in constructing a transmission
grid to connect to the customer's power grid per the construction
investment boundary specified in the Connection Agreement.
 Plant investors are responsible for (i) investing in the construction of the
power grid system and (ii) managing and operating the power systems in
compliance with the regulation on the transmission power systems and other
regulations.
 EVN reported that in 2020, 364 million kWh of generated solar
power was untapped, and in 2021 the amount of unused
renewable energy (solar and wind) was about 1.68 billion
kWh, approximately 7% - 9% of each source.
 As a result, the National Load Dispatch Centre announced
that it would not approve any new wind or solar projects in
2022.
The sheer number of new projects that have achieved
Commercial Operation Date (COD) has outpaced the grid's
ability to integrate them since 2020, particularly in provinces
with high concentrations of solar and wind projects.
To attract all economic sectors to participate in the construction investment activities of transmission power grids, Law No. 03/2022/QH15,
promulgated by the National Assembly on January 11, 2022, has allowed non-state economic sectors to operate the transmission grid under Article

Grid congestion and lack of comprehensiveplanning
"To build up and develop the electricity market on the principle of publicity, equality, fair competition with the State's regulation to raise efficiency in
electricity activities; to ensure the legitimate rights and interests of electricity units and electricity-using customers; to attract all economic sectors to
participate in investment in the construction of transmission power grids on the basis of ensuring national defense and security and according to
the power development plan, electricity generation, electricity distribution, electricity wholesaling, electricity retailing and/or specialized electricity
consultancy.
Non-state economic sectors are allowed to operate the transmission power grid built by themselves."
Article 6.1, Law No.
03/2022/QH15
 Law on Planning 2017 has caused difficulties and obstacles,
greatly affecting progress of key grid projects.
 Power planning is not consistent with national master plans and
national land use plans, many projects not included in local land
use plans, especially 500kV projects.
 The agreement on the DR route and the substation location
encountered many problems especially in big cities.
 Compensation unit price. The compensation unit price approved
by the authority often does not keep up with the actual market
price, leading to no consensus of the people and lengthy
complaints.
 The procedure for applying for the conversion of forest land,
especially natural forest to land for project construction, is quite
complicated.
 Investment cost of inter-regional transmission grid is
calculated on the basis of investment rate of 500kV
transmission lines as follows:
- 500kV line: 600USD/MW/km
- Substation 500kV (AC): 20,000 USD/MW
- 500kV converter/inverter station: 90,000 USD/MW
- 1-way line +/-525kV: 360 USD/MW/km
(One-way line +/-525kV, 1200km, transmission capacity of
5000MW, including: line: 2160 million USD, double-ended
inverter station: 900 million USD).
*Investment unit price of Sumitomo and ABB, along with
investment unit price of projects in Vietnam.
However, unlike power generation projects, developing grid transmission projects faces many obstacles and requires huge financial sources.

Limited forecasting of variable energy and lack of policy incentives for its complementation
 The booming renewable energy supply has led to several problems in the operation of the grid, such as local overloading, full loading, and
increasing the number of systems restart and adjustment.
Limited forecasting of
variable energy
No incentive for other
complementary energy
sources
Limited connections
with the neighbors
 Thus, besides lacking clear plans to address grid congestion, Vietnam is also facing obstacles in dealing with these problems because of the
following reasons:
The limitation in reliably forecasting of
several factors could inhibit the ability to
match supply and demand
 distribution expansion planning
 transmission expansion planning
 generation expansion planning
 Liquefied natural gas (LNG) plants that can
be adjusted their capacity to complement
solar and wind output.
 However, conventional PPAs do not allow
for flexible operation. Changing PPA terms
and instituting a preferential tariff could
incentive battery storage and optimize the
use of traditional power sources.
 Viet Nam trades electricity with neighbors
China, Lao PDR and Cambodia, but
Vietnam has kept imports low because of
concerns over energy security.
 Increased power import could enable
Vietnam to meet power needs and diversify
the energy mix when solar and wind
underproduce.

Feed-in Tariffs (FITs)
Decision 13/2020/QD-TTg dated 6 April 2020
On mechanisms to promote the development of solar power
projects in Viet Nam
Solar power
Floating solar power project
Ground mounted solar power
Rooftop solar power project
7.69 UScent/kWh
7.09 UScent/kWh
8.38 UScent/kWh
Wind power
Onshore wind power project
Offshore wind power projects
8.5 UScents/kWh
9.8 UScents/kWh
Decision 39/2018/QD-TT September 10, 2018
On provision of assistance in the development of wind power
projects in Vietnam
This FITs have been applied for the electricity generated by the part
of the project or whole project that have been able achieved COD
from 1st July 2019 to the end of 31st December 2020.
This FITs have been applied apply to a part or the entire grid-connected
wind power plant whose commercial operation date is earlier than
November 01, 2021 and remain unchanged for 20 years from that day.
The new FIT rates for solar power under the Decision 13 and for wind power under Decision 39 have expired and no updated or alternative
FIT mechanisms have been published. All projects that miss the above deadlines will be decided through a competitive bidding process.

OPTION 1 OPTION 2
Option 1, MOIT develops and promulgates regulations on
methods and procedures for setting up and appraising the
electricity generation price range and stipulating the
electricity generation price range for wind and solar power as
basis for EVN to negotiate and sign power purchase and
sale contracts with project investors.
“According to MOIT, the comparison with the regulations
shows that Option 1 absolutely complies with the provisions
of the Electricity Law, the Price Law and guiding documents
of the Electricity Law.”
Option 2 is to develop the Prime Minister's decision
stipulating the bidding mechanism to buy electricity from the
wind and solar traditional projects. Accordingly, it is expected
that the buyer, EVN, will organize a bidding for electricity
purchase within a period of 3 years, within the price range
promulgated by the Ministry of Industry and Trade.
“According to MOIT, the legal basis was not clear when
compared with current regulations. In addition, in the process
of developing this bidding plan to buy electricity, many
investors expressed the disagreement with this option
because the bidding for power purchase only for a few years
was thought to be not a solid legal basis, affecting the cash
flow, ability to pay back capital and repay the bank debt of the
implemented projects.”
FITs – 02 Options for Power Projects that missed the COD proposedby MOIT
On August 11, 2022, according to the Explanatory Note No. 4778/TTr-BCT, MOIT proposed to Prime Minister to approve the Option 1 on price
mechanism for wind and solar traditional projects which serve as the basis to enable EVN to negotiate and enter into PPAs with project
developers.

Non-bankable standard Power Purchase Agreements (PPAs)
In Vietnam, all power plants must adopt a non-negotiable standardized agreement issued by the MOIT. Nonetheless, the standard PPA of EVN does not
meet the international requirements.
Concerns regarding EVN’s PPA bankability
Dispatch risk: There is no take-or-pay obligation or minimum
purchase guarantee, neither is there any time limit on EVN's
suspension to purchase electricity output in PPAs.
Foreign Exchange Risk: EVN’s PPA requires the tariff to be
denominated in Vietnamese Dong, therefore, investors are exposed to
foreign exchange risk.
Change in Laws: PPA2019 does not include any provisions
regarding changes in laws or taxes and project developers shall only
rely upon the investment guarantee protection provided under the Law
on Investment.
Extended Force Majeure: PPA2019 stipulates that a party may
terminate contract after 01 year of prolonged force majeure events,
which will put project developers under financial pressure to manage
their cash flows, loan repayments and attorney fees.
Termination and Termination Payments: PPA2019 does not provide any
provision for a fixed termination payment payable to the power plant, whether
due to a breach of EVN, breach of the power plant, or prolonged force
majeure.
Off-taker Payment Support: : PPA may require additional payment support
(Letter of Credit, guarantee, etc.) in order to be bankable.
Transmission and interconnection risk: : Under the PPA, the seller is
required to invest in, operate and maintain interconnection equipment
and facilities in order to connect the power plant with the power
transmission and power distribution grids as well as bear the costs of
assembling the metering system at transformer stations.
Term of PPA: : PPA2019 has the standard 20-year term with an option to
extend upon mutual agreements. However, PPA term does not take into
account the events of force majeure or disputes such as EVN’s inability to
pay.
Dispute Risk: Under EVN’s PPA, the governing law is the laws of
Vietnam. International investors share that the dispute resolution
provisions under EVN’s PPA are inadequate.
In February 2022, a pilot scheme of the direct power purchase agreement (DPPA) is planned by MOIT to run for two years (2022-
2024), and will be introduced into the market from 2025 onwards. Implementing the DPPA pilot scheme is a significant step in
Vietnam's journey toward a liberalized wholesale and retail electricity market.

Complex administrativeand legal procedures
Obtaining the relevant permits required to develop an energy
project is a complex process that involves a substantial amount of
work. These permits can include:
Admission to the National Power Development Master Plan
(NPDMP)
The procedure to obtain these licenses involves a large
administrative burden and is time-consuming. This results in
delays and additional costs to businesses.
Investment certificate registration
Appraisal of feasibility study
Grid connection agreement, metering agreement,
SCADA agreement, PPA with EVN
Environmental impact evaluation
Technical design, land clearance, construction permit

01
02
03
04
05
06
Law on Bidding 2013
Decree No. 25/2020/ND-CP on
elaborating some articles of the
Law on Bidding on investor selection
Law on Investment 2020
Statement 1513/TTr-BCT on the bidding mechanism to
purchase electricity from wind and solar power projects
Law on Public - Private
Partnership investment
2020
Decree 35/2021/ND-CP on the elaboration of
some Articles of the Law on PPP Investment.
Rules and
regulations on
Public
procurement
Vietnam's current regulations do not specifically
provide a comprehensive framework for the
competitive selection of independent power producers
(IPPs) in the Vietnamese electricity market.
In reality, PPP is not a popular form of investment for
solar or other renewable energy projects in Vietnam
(compared to private investment/IPP).
Even though, PPP arrangements may still be effective
instruments for larger or riskier renewable projects,
where government incentives and negotiable contract
terms can provide additional reassurance to investors
Regulations for
foreign investors
Bidding regulations
for EU investors
o The condition for a foreign investor to be eligible is being in a joint venture with domestic contractors
or employment of domestic subcontractors in case of a foreign contractor making international
bidding in Vietnam unless the domestic contractor cannot acquire the competencies necessary to
perform any portion of the package (Pursuant to Clause 1 Article 5 of Law on Bidding).
o Vietnam allows EU enterprises to participate in public procurement, with bidding packages reaching a
value higher than a certain threshold and gradually decreasing over 15 years.
o At present, EU investors can only engage in large bidding packages valued at over USD 2 million.
Compared to domestic enterprises, the EU ones would only be permitted in large projects.

Attractive and open environment for FDI in
Vietnam
Additional step required of foreign renewable
developers is to apply for an investment registration
certificate (IRC)
Vietnam investment law does not require investors to
source locally. Treaties such as the TRIMS (WTO) and
the EVFTA reinforce this.
Decree No. 59/2015/ND-CP, on construction project
management states that foreign contractors must use
Vietnamese subcontractors when doing construction
work in Vietnam.
Current regulations do not expressly require foreign
investors to hire local workers, the 2012 Labour Code
gives Vietnamese workers preference for certain
positions.
01
02
03
04
Regulations on non-tariff barriers in
EVFTA
Both parties show goodwill to eliminate or mitigate the
barrier levels. Most of the contents of non-tariff barrier
removal are presented in
 Article 7.4 (Principles)
 Article 7.5 (Standards, Technical Regulations, and
Conformity Assessment).
Chapter 7 (Non-tariff barriers to trade and investment
in renewable energy generation) shows that the EU
and Vietnam are able to use trade agreements not only
for the benefit of trade but also for the benefit of
tackling climate change: more renewable energy will
contribute to that.
01
02

PART 1 Conclusion
Vietnam has undergone significant transformation over the last two decades, pivoting the industry towards
greater private participation and market-based principles. In the near future, renewable energy sector is
expected to attract more and more leading clean energy investors, including domestic enterprises, large-scale
domestic households, and foreign players.
To address current bottlenecks in the renewable energy sector
 The MOIT is currently working hard to propose a new price mechanism for transitional solar and wind power
projects that missed the COD deadline.
 The government is seeking to implement a DPPA pilot scheme that will enable renewable energy
generators to directly sell clean electricity to private off-takers under virtual or synthetic PPAs in 2022-2024.
 The government also passed amendments to the Law on Electricity 2004 to allow private companies
directly invest in transmission lines. These policy development efforts have created a broad spectrum of
opportunities for investors from the EU to enter the Vietnamese renewable energy sector.

PART 1 Conclusion
EVFTA and EVIPA will further broaden market access for EU investors. The EU companies can benefit from the
non-economic provisions of the EVFTA, and many precise standards on investment protection in the EVIPA,
including
(i) provisions on non-discrimination,
(ii) allowing investors to transfer or repatriate investment-related funds,
(iii) prompt and adequate compensation in cases of expropriation,
(iv) a commitment to fair and equitable treatment, and
(v) a guarantee that contractual and legal obligations toward investors will be honored.
EU can bring their technology and know-how, especially from countries with advanced technical expertise and
developed renewable energy sectors such as Spain, Sweden, Germany, and Denmark, to Vietnam with fewer
market access barriers and more secure. Besides, they also can consider providing technical and financial
support as well as technology transfer or establishing joint ventures with domestic companies to exploit the
massive potential of both sides

Practical Cases
PART 2

Business
opportunities in
climate change
adaptation and
mitigation sectors
Agriculture
Electric vehicles
Solar and wind
power equipment
Healthcare
Urban development

Agricultural sector's GDP share in 2021
million people
Working in agricultural sector (2020)
of all water withdrawals are
for agricultural production
agricultural output of the Red River Delta and
the Mekong River Delta is likely to decrease
due to the impacts of climate change
Agroecological zones
National context
Vietnam's
agriculture
Red River Delta and Mekong River Delta are
ideal places to produce rice and livestock,
other cash crops are centered in the Central
Highlands and the southeast.
 Viet Nam is one of the 30 "extreme risk countries" in the world under the effects of climate change, such as decreasing agricultural
area, increased drought, and pests, putting huge pressure on the development of the cultivation process.
 Loss of farmland and diminishing crop yields would offer challenges and dangers to farmers' livelihoods, rice exports, and national
food security, particularly in a country where agriculture is crucial to the national economy like Vietnam.

By using Climate Smart Agriculture (CSA), the Vietnam’s agricultural sector can get the potential to assist in mitigating climate change and
increasing resilience by means of adaptation
CSA is an approach to farming that sustainably increases productivity,
enhances resilience to the impacts of climate change and reduces GHG
emissions, where possible, and enhances development of national food
security and development goals
In Vietnam, CSA has been primarily financed by the central budget and
international funding. The majority of investments are from large entities such
as WB or ADB, and only a small contribution is from the private sector.
CSA technologies and practices have been widely applied around the world
and good turnover has been recorded. For the agricultural sector, Vietnam
would prosper in the application of CSA in the fields of crops and livestock.
Climate Smart Agriculture (CSA)
CSA Financing
CSA Practices
A number of projects have been or are being implemented by GoV and its
partners in context of the CSA country programme such as: Food and
Agriculture Organization (7 projects); International Finance Corporation (6
projects); Norwegian Agency for Development and Cooperation (5 projects),…
CSA Projects
Climate-smart agriculture (CSA)
 CSA projects in Vietnam are often financed by Government institutions or NGOs, with substantial capital, in the form of long-term loans.
 Although the Government has many policy incentives, it may not appeal to the private sector engaged in the CSA projects.

Climate Smart Agricultural Value Chain Development in
Ben Tre and Tra Vinh Provinces (Project ID 2000002335)
Climate-smart agriculture (CSA)
 Duration of project: 2021 - 2026
 Financiers: International Fund for Agricultural
Development (IFAD), Dutch Fund for Climate and
Development, Domestic Financing Institutions,
National Government, Beneficiaries
 Value: US$ 136.38 million
 Impact: The Climate-smart Agricultural Value Chain
Development aims to achieve sustainable and climate-
resilient rural transformation in Ben Tre and Tra Vinh
provinces.
 Outcomes: Generate sustainable income opportunities and
improved rural livelihoods for 60,000 smallholder farmers’
households, with a focus on women, youth, and ethnic
minorities:
1. Effective provincial & regional coordination for sustainable
and inclusive rural transformation
2. . Inclusive and climate smart value chain established
Source: https://www.ifad.org/en/web/operations/-/project/2000002335
- Specific project

Agtech Industry
01
Current
situations
Agtech is the use of technology in agriculture with the aim of improving yield, efficiency, and profitability. Agtech can be products, services,
or applications that come from agriculture that improve various input/output processes
 Despite being an agricultural economy,
Vietnam’s agtech industry still lags far
behind developed countries.
 the number of agtech projects and
companies in Vietnam is relatively tiny.
02
Government
policies
 Decision No.749/QĐ-TTg (2020)
recognises agriculture as onn of eight
priority sectors for digital transformation
 Decision No. 255/QD-TTg (2021)
restructures plans for this sector for 2021-
2025 period in order to develop a modern
and sustainable agriculture to connect with
global value chain.
03
Financial
support
 The State Bank of Vietnam and other
banks have offered a financial package of
VND 100 trillion (US$4.37 billion) to assist
hi-tech agricultural businesses.
 The Ministry of Planning and Investment is
drafting a decree that will revise Decree
No. 57/2018/ND-CP to support loans and
interest rates as well as provide financial
aid for investors in this sector.
 Aus4Innovation program
 Agitech Vietnam Program
04
Global
support and
interest
 Four of agritech sub-sectors are (IoT), smart farming, machinery and software, Genetics and breeding

Agtech Industry
 IoT in agriculture involves sensors, drones, and robots connected through the internet which function automatically and semi-
automatically performing operations and gathering data aimed at increasing efficiency and predictability.
 The automated system will enable farmers to optimize their water, electricity, and fertilizer usage, achieve maximum crop yield, and
provide complete traceability to their commercial partners.
 Foreign businesses may encounter competition from local businesses as domestic companies are more advantageous in terms of
accessibility to customers and familiarity with the local market.
MimosaTEK'S Solutions Ecosystem
Example: MimosaTEK (Vietnam)
MimosaTEK is one of the Vietnamese successful startup
agtech companies with key solutions:
 soil nutrient analysis
 pH neutralization of the irrigation water
 smart irrigation management solution
 smart irrigation and fertilizer management solution
 greenhouse microclimate management solution
- Internet of things (IoT)

Agtech Industry
 Opportunities
 Provide farm management package
solutions for both large-scale companies
and small farmers.
 Agricultural services and consulting related
to animal husbandry, food safety, and
quality assurance
 Challenges
 Smart farming necessitates a
comprehensive approach that includes
• seed technology
• production
• harvesting and post-harvest storage
• transportation
 Vietnam's agricultural market is
highlyfragmented => implementing farming
management can be difficult
 Example
 Some foreign investors that are eyeing this
sector in Vietnam include
• Enzootic (Israel and Hong Kong),
• GoodHout BV (Thailand),
• SmartFarm Co Ltd (Thailand),
• FairAgora Asia (Thailand),
• GAGO (China),
• Intello Labs (India),
• Pycno Industries (Australia),
• Gintel (Taiwan), and
• Fluence corporation-NIROBOX (Israel).
(Vietnam briefing, 2021)
- Smart farming

CNH Industrial a world-class equipment and services company that
sustainably advances the noble work of agriculture and construction
workers operating in Vietnam:
 Tractors
 Harvesting equipment
 Seeding & Planting
 Tillage
Agtech Industry
 60 – 70% agricultural machinery in Vietnam is imported, mainly from China and Japan.
 Leading domestic companies are Vietnam Engine and Agricultural Machinery Corporation (VEAM), Hanoi Agricultural Machinery and Agricultural
Extension Company (HAMCO), and Vietnam Institute of Agricultural Engineering and Post-Harvest Technology (VIAEP).
 Leading foreign companies operating in Vietnam include Kubota, Iseki and Yanmar (Japan), CNH Industrial (USA-Italy), CLAAS KGaA GmbH
(Germany), Buhler (Switzerland), ShanDong Huaxin Machinery (China), and Tong Yang Moolsan (South Korea). These brands depend mostly on
their agent and distributor network to enter and expand in the Vietnamese market.
 Due to high capital injection involving large-scale capabilities and high levels of commitment and management, partner opportunities are limited to
mainly larger corporations.
Example: CNH Industrial (USA-Italy)
 Application equipment
 Hay & Forage
 Material handling
 AFS Precision Farming
- Machinery and software

Agtech Industry
 Vietnam are looking to nuclear techniques to develop new and improved crop varieties for cultivation - in order to improve crop adaptation to a
changing climate.
 Throughout the years, with the help of many organization, funds and enterprises, Vietnam has made some advancements of gene technology in
selecting and creating species of crops and livestock, which have high yield, are of good quality, and are resistant to diseases.
• 1970s: has already been researched and applied in Vietnam
• 1980s: Through technical cooperation projects with IAEA, research
institutions agricultural genetics in Vietnam (i.e, Agricultural Genetics
Institute, Institute of Agriculture Science for Southern Vietnam, Cuu Long
Delta Rice Research Institute, Center for Nuclear Technologies HCMC,
Nuclear Research Institute) started to promote research and
development of radiation mutation breeding.
By 2021, Vietnam has created and put into production 71 mutant plant
varieties by irradiation method:
- 47 varieties of rice (DT10, DT11, Tam Thom Dot Bien, ST3DB…)
- 13 varieties of soybean
- 11 varieties of corn, flowers, apples, mint
Especially, at the World's Best Rice contest, ST25 rice variety won the
title in 2019, secured second place in 2020 and stayed in Top 4 in
2022.
Example: Radiation-supported plant mutation
breeding
- Genetics and breeding

Center for Application Research and High Technology
Transfer in Agriculture
- Managed by Tropical Development and Investment
Co., Ltd – an affiliate of HM Clause Group (France), an
agricultural corporation with the second largest scale
in the world in terms of plant seeds and vegetable
seeds.
- Purpose: Breeding, production, and sales of high-
quality vegetable seeds that adapt to the changing
climate environment
Rijk Zwaan Vietnam R&D Station
- Owned by Rijk Zwaan Vietnam Co., Ltd – a subsidiary of Rijk
Zwaan Group, an international company in the breeding and
development of vegetable varieties, headquartered in
Netherlands.
- Purpose: Carefully research, develop and select high-quality
indoor vegetable varieties with high tolerance and high
resistance, ensuring that selected seeds are suitable for
growing in the changing climatic and environmental conditions
in Vietnam
- Products: bell pepper, tomato, cucumber, broccoli, lettuce
Agtech Industry - Genetics and breeding (FDI projects)

Food Chain Partnership initiative to help smallholders to get
GLOBALG.A.P. certification
Company: Bayer, Vineco
Impact: help farmers improve production and increase
harvests.
Outcomes: help smallholders implement more effective and
sustainable farming practices on their way to GLOBALG.A.P,
the long-term aim is VinEco passing its knowledge of
sustainable agriculture on further, to its network of more than
1,000 smallholder farmers.
DHN Gia Lai Hi-tech Application Agriculture Complex
Company: De Heus, Hung Nhon Group
Value: VND 1,030 billion
Objectives: provide clean, high-value products for the benefit
of consumers.
Investment content: The land use scale is about 100
hectares, including: 2,500 pig breeding farm selected and
imported directly from the Netherlands, pig slaughter factory,
organic fertilizer factory, operation and support service area,
organic farming area and green land, land for traffic and
technical infrastructure, area for gathering, purchasing,
preserving and packing fruit with high quality export
standards...
Technology sharingin the Agtech Industry

Because of the ease of integrating IoT
products/services into existing farming
systems, the barrier to entry and
investment is relatively low. However,
domestic firms may have a competitive
advantage due to their understanding of
the market
Foreign companies, may take longer to
enter the market because smart farming
necessitates a comprehensive approach
that includes seed technology, production,
harvesting, post-harvest storage, and
transportation.
Foreign companies that supply robotics,
machinery, and equipment to automate farm
work should look for opportunities to partner
with local corporations
1. Internet of
things (IoT)
2. Smart
farming
3.
Machinery
and
software
4. Genetics
and breeding
Overseas companies can collaborate with various
institutes, universities, and startups to improve
agricultural productivity through research.
However, foreign companies may
need to invest in advanced training and R&D
to characterize the markets.
Agtech Industry
 Viet Nam has established a solid foundation for digital agricultural solutions.
 With the increasing use of digital technologies, Vietnamese agriculture is gradually transitioning from traditional to modern agriculture
and adapting to climate change.
 AgTech is a relatively new sector with plenty of room for growth.

 Roadways, railways, and inland waterways in Vietnam will be
heavily affected by climate change.
 In case the sea level rises by 100 centimeters (cm), it will affect:
o 4% of the railway system
o 9% of the national highway system
o 12% of the provincial roadway system
o 28% transportation systems in Mekong Delta
 Road infrastructure also will suffer a great impact from saltwater
intrusion especially steel structures, due to erosion to metal and
other materials by salinity.
 Key objectives in the formation of the Vietnamese transportation
sector are:
 Development of sustainable infrastructure
 Adoption of more energy-efficient vehicles

Report on Climate Change Adaptation in
the Road Transport Sector and
Mitigation of GHG Emissions in the
Transport Sector (Ministry of Transport,
2022)
Decision No.1831/QD-TTg dated Nov
1st, 2021on introducing the list of national
projects calling for Foreign investment in
the 2021 - 2025 period
 The report has established complementary objectives at
a strategic level in continuing implementing road
transport project programs in Vietnam.
 The program does not mention the role of the private
sector in these programs.
 The Decision 1831announced a portfolio of 157 national
projects subject to foreign investment during the 2021-
2025 period.
 The government has already encouraged the foreign private sector to undertake transport planning projects
in response to climate change but it is still unclear..
 These transport infrastructure projects listed in the
Decision 1831 are not directly described as climate
change adaptation. However, there are some projects
with the goal of reducing environmental pollution such as
 Urban railway line (Metro) No. 4
 Urban railway line (Metro) No. 3a
 Urban railway line (Metro) No. 2 – phase 2

No. TITLE OBJECTIVE LOCATION SPECIFICATION
TOTAL
INVESTMENT
(Million USD)
1
Urban railway line
(Metro) No. 4
Urban rail line No. 4 provides radial rails
transporting passengers along the most
densely populated areas of Ho Chi Minh
city past Ben Thanh area along the North
– South axis. Providing public passenger
transport services with relatively large,
safe transport capacity and reduced
environmental pollution
Districts: 1, 3, 4, 7,
12, Go Vap, Phu
Nhuan and Nha Be
Total length: 36.2km and routes and
directions: Thanh Xuan - Ha Huy
Giap - Nguyen Oanh - Nguyen
Kiem - Phan Dinh Phung - Hai Ba
Trung - Ben Thanh - Nguyen Thai
Hoc - Ton Dan - Nguyen Huu Tho -
Hiep Phuoc urban area.
4,570
2
Urban railway line
(Metro) No. 3a
Providing public passenger transport
services with relatively large, safe
transport capacity and reduced
environmental pollution
District: 1, 3, 5, 6,
10, 11, Binh Tan,
Binh Chanh; Ho Chi
Minh city
19.58km long with the routes and
directions of Ben Thanh - Pham
Ngu Lao - Cong Hoa Roundabout -
Hung Vuong - Hong Bang - Kinh
Duong Vuong - Tan Kien Depot -
Tan Kien Station.
1,820
3
Urban railway line
(Metro) No. 2 –
phase 2
Providing public passenger transport
services with relatively large, safe
transport capacity and
Districts: 1, 2, 12,
Hoc Mon, Cu Chi;
Ho Chi Minh city
Length: 9.1km, including Ben
Thanh – The Thiem and Tham
Luong – Tay Ninh bus station
1,482
List of transport infrastructure projects with environmental goals in Decision No.1831/QD-TTg dated Nov 1st, 2021on introducing the list of
national projects calling for Foreign investment in the 2021 - 2025 period

Vietnam’s existing regulatory landscape is still premature for promoting green vehicles.
In trying to attract investments in EVs, the Vietnamese Government has recently proposed several policies:
Preferential tax programs for
environmentally friendly
vehicles
Reducing the registration fee of electric vehicles
National Automobile Development Strategy
(2021-2050) proposed by Vietnam Automobile
Manufacturing Association (VAMA)
Tax reduction policies for assembling
components and producing electric cars
 The first phase (2021-2030):
Vietnam would reach 1 million EVs by
2028
 The second phase (2030-2040):
Vietnam would strongly develop EVs,
aiming to have about 3.5 million
vehicles by 2040.
 The third phase (2040-2050): Time
for steady growth of EVs, with 4.5
million vehicles by 2050.
 From March 1, 2022, to the end of February 28, 2027,
battery-powered electric cars with 9 seats or fewer will
be subject to a tax rate of 3%; From March 1, 2027, the
tax rate will be 11%.
 The type that carries people from 10 to under 16 seats
is 2%; from March 1, 2027, is 7%.
 Electric cars carrying people from 16 seats to less than
24 seats will be subject to a tax rate of 1%, from March
1, 2027, the tax rate is 4%.
 Other types of electric cars will bear special
consumption tax rates ranging from 5 to 15%,
depending on the type.
 Article 8 of Decree No. 10/2022/ND-CP stipulates the registration tax rate of battery-powered electric cars:
 - Within 3 years from the date this Decree comes into force: the first-time registration fee is 0%.
 - Within the next 2 years: the first-time registration fee is 50% of the fee rate for petrol and oil cars with the same quantity of seats.

Besides the policies mentioned, the Vietnamese policy framework dedicated to EV and its charging infrastructure development still has:
 Resolution 55/NQ/TW issued on 11 February 2020 providing Guidelines for the National Energy Development Strategy until 2030 with a Vision
to 2045, is the first official national document that requires the promotion of e-mobility and energy storage in line with global trends.
 Decision 1095/QĐ-BGTVT dated June 17,2021 on building National Transportation Vehicle Development Strategy with an aim to develop
environmentally friendly vehicles, implemented by the Transport Development and Strategy Institute during 2022-2023.
 Approved Paris Agreement in July 2020 with commitment in its updated Nationally Determined Contribution (NDC) to cut GHG emissions by
9% in 2030. EV adoption has a high potential to reduce GHG emissions in the transport sector. As part of NDC plan, in Jan 2022, Ho Chi Minh
City has been chosen as the first locality to carry out studies on the e-transportation development plan, involving e-vehicles in the southern hub.
 Decision No. 1393/QĐ-TTg in 2012 regarding the National Green Growth Strategy (NGGS). Ministry of Planning and Investment is formulating
a new NGGS for the period 2021-2030, considering for vehicle electrification. In addition, some provincial Green Growth Action Plans include
transportation considerations and electrification targets.
 Hanoi Green Growth Strategy sets the target of e-motorcycles reaching 5% of total motorcycles in Hanoi by 2030.
 Nha Trang Green Growth Strategy aimed to develop 200 e-buses in circulation by 2025 in Nha Trang.

With the current inevitable trend for EVs, the initial development of the battery industry, and charging infrastructure, the pioneer of key private
manufacturers coupled with the Vietnamese Government’s efforts to promote low-carbon transport development.
A large proportion of the population takes motorcycles as daily
transportation
Young population and increasing middle class
The EV market in Vietnam is in its infancy
The limited number of EV charging stations.
Opportunities
Challenges
 60% of Vietnam’s population owning motorcycles
 Car ownership rate of 5.7% in 2020 => expected to increase to 9% by 2025 and 30% by
2030
 Vietnamese will have a strong interest in cutting-edge technologies, fuel efficiency,
and environmental awareness.
 The number of electric automobiles in Vietnam remains modest at 140 in 2019, 900
in 2020, and an additional 600 units as of the first quarter of 2021, in which most of
them were still hybrid models.
Vietnam’s electricity demand is increasing at an average rate of 9% a year, which
may face power shortages from 2021.

Renewable energy equipment
manufacturing
 Solar and wind power
equipment manufacture
 Policy incentives

 imported 36.2 million
solar panels
 value USD 844.8 million
 up 224% compared to 2018
2019
2020
 the volume imports tripled to
114.6 million panels
 value up to $2.4 billion
 an increase of more than
185% compared to 2019
 More than 99% of solar panels in Vietnam are imported
 Vietnam mainly imports solar panels from China
Most solar power equipment imported from the EU has enjoyed
a preferential tax rate of 0% due to the EVFTA.
However, a few items are still not eligible for this tax rate
because the tax reduction schedule has not been completed,
e.g:
 distribution board,
 switchboards,
 connection and contact elements for wires…
EVFTA

 First Solar is an American
manufacturer of thin film solar panels.
 The total investment capital of the
company in Vietnam is up to 830 million
USD/1.2 billion USD of registed capital.
 Trina Solar (VietNam) is owned
100% by China Trinasolar Group, with
total investment capital of 100 million
USD.
 Canadian Solar is a project of a
corporation in Canada, but also founded
by Chinese owner.
 JA Solar is invested by JA Solar Group
(China) with an announced capital of 1
billion USD in Quang Chau Industrial
Park (Bac Giang).
 Vina Solar is a Vina Solar Technology
Vietnam Co., Ltd. project invested by
Ningbo Yize New Energy Company
(Ningbo Yize). In 2020, LONGi Group
acquired Vina Solar from Ningbo Yize for
$253 million.
 HT Solar is invested by Haitech
Holdings Co., Limited, UK Sun Chance
Ltd, and one Chinese investor. The total
investment capital of the project is 22
million USD.
 There are currently about 8 large solar panel factories in Vietnam and only one factory is Vietnamese enterprise (Solar BK with its solar
panel manufacturing subsidiary, IREX Solar (Vung Tau)

Only a few original equipment manufacturers (OEMs), mainly large international companies, produce large wind turbines
The dominant suppliers of wind turbines to Vietnam are
 General Electric Company (GE) (United States)
 Vestas (Denmark)
 Fuhrländer (Germany)
The two largest wind power equipment manufacturers in Vietnam are GE Vietnam and CS Wind
GE Vietnam CS Wind
 In Vietnam, the market for producing equipment for renewable energy sources is small as it does not host a large number of domestic
and foreign companies.
 There is still much room for growth, and it may be a market worth exploring for manufacturers and investors in the EU.
 One of the first American companies established in
Vietnam in 1993.
 Plays a key role in Vietnam’s first wind farm in Bac
Lieu province. GE supplied 62 wind turbines,
totaling over 99 MW of power generation capacity.
 Chosen as the provider of 14 turbines in Phase I of
Tay Nguyen Wind Farm project.
 Signed a MOU with MOIT to accelerate the
development of RE in Vietnam in 2016.
 Established in Vietnam in 2003.
 The first wind tower factory in Vietnam,
manufacturing wind towers and fabricating steel
structures for wind towers.
 Signed a contract with Vestas Asia Pacific A/S
worth VND 364 billion to supply wind towers to
Vietnam.
 Signed a MOU with Ørsted to accelerate offshore
wind power supply chain in Vietnam in 2022.

Policy incentives for renewable energy equipment manufacturingindustry
Equipment HS code
Preferential
import tax
Normal import
tax
Value-added tax
(VAT)
Solar panel
85414021 (Photovoltaic cells, not assembled)
85414022 (Photovoltaic cells assembled in modules or
made up into panels)
0% 5% 10%
Wind generator 850231 (Other generating sets: Wind-powered) 0% 5% 10%
Wind turbines 84119100 (Parts of turbojets or turbo-propellers) 0% 5% 10%
General regulations: According to Decree No. 08/2022/ND-CP dated January 10, 2022, detailing a number of articles of the Law
on Environmental Protection:
 Renewable energy equipment manufacturers are entitled to incentives for exemption and reduction of land use levy and rent
according to the provisions of the land law.
 Solar panels are on the list of products that manufacturers and importers must recall and recycle.
Tax and
tarrif
 The Government has given some favorable conditions in terms of tax policies for new traders entering the market, and it can be
considered as a potential ground for international players to join in and expand their businesses in Vietnam.

Climate extremes negatively affect human health,
leading to increased vulnerability, especially among
the elderly, women, children and people with
chronic diseases.
Climate change facilitates the development of
vector-borne diseases, increasing the likelihood of
outbreaks and spread many diseases.
Climate change is increasingly creating adverse
effects on human health, requiring more remedial
measures as well as investment in public health to
enhance climate resilience.

 Healthcare facilities
(e.g., Devices and equipment installed
for monitoring indoor temperatures,
cooling existing buildings and spaces,
blocking direct sun, increasing air flow
in case of extreme heat
 Climate-resilient infrastructure
(e.g., Proven smart materials and
applications, sensors, low power
electronics and similar health care
appropriate technology such as
telemedicine, remote sensing
systems)
 Pioneering new products,
services, and models that meet
future health care needs
(e.g., Satellite-based remote sensing
of meteorology and environmental
conditions on the ground for weather
warnings, monitoring, surveillance)
 Investing in capabilities such as data
mapping (e.g., integrating data on drought
impacts into patient geographies) and
 predictive analytics (e.g., leveraging risk
stratification scoring to prioritize system
waste reduction effort).
 Innovative technologies (e.g.,
remote sensing, virtual
platforms)
 care models (e.g., hospital-at-
home, on-demand virtual
primary care providers)
 ‘Age-friendly’ businesses
(e.g., providing personalized
care, assisting in functional
physical or cognitive decline,
improving old people’s health
literacy, nursing home).
1
2
3
4
5
6
EU investors can invest in public health-related fields:

Health Information Technology
 implementing the digitization of healthcare: the MOH has encouraged hospitals to
apply technology to their operation to increase efficiency.
 The Government’s plan to expand the use of telemedicine is expected to pave the
way for adoption. International investors are encouraged to participate.
 Currently, telehealth services are limited to basic consultations but can be
expanded to numerous areas
Telemedicine
Consumer Health Electronics
 Wearables can potentially revolutionize how people monitor and maintain their
health and act on personalized data.
Healthcare Big Data and Artificial intelligence (AI)
 AI and Big Data applications are receiving strong support from the central
Government. It is hoped that these applications will drive the development of digital
healthcare infrastructure and enable new research and development (R&D) and
enhanced healthcare delivery capabilities.
01
02
03
04
 The Government is aggressively trying to attract more international investors to this industry, particularly for the digital health sector.
 Given the lack of domestic participation in the digital health industry in Vietnam, there are numerous investment opportunities for foreign

Health InformationTechnology
 FPT.eHospital is a comprehensive software system for hospitals
that manages all activities from the point of receiving patients to
the time they leave the hospital.
Practical case: FPT.eHospital.
 The solution consists of 22 functional modules and is divided
into five main groups:
 management of medical examination and treatment;
 administration and office management;
 laboratory management;
 image transfer, processing, and storage;
 and secure data storage
Opportunities
 Vietnam has set the goal to promote Electronic Health Records
(EHRs) under the governmental plan (Decision No. 5349/QD-
BYT)
=> The Vietnamese government has acted swiftly to embrace
Industry 4.0, extending this to the digitisation of healthcare.
Challenges
 Financial pressures: Hospital management software and the
broader information technology infrastructure is expensive.
 Lack of investment in human resource training: all
healthcare professionals will need to be trained in the use of
digital systems. This may be a significant hurdle in rural or
remote regions of the country.
 Concerns over data privacy and cyber security laws to
protect patient data.

Telemedicine
Opportunities
 the government has implemented a pilot program with Hanoi
Medical University Hospital linking it with several satellite
hospitals, commune health stations, and patient homes.
 This program is expected to serve as a steppingstone to the wider
adoption of telemedicine in Vietnam
Challenges
 Lack of clear regulation framework for telemedicine:
Circular 47/2017/TT-BYT is the only regulation governing
telemedicine activities so far.
 Underdeveloped infrastructure, especially in rural areas
 Challenges for changing behaviours of medical
professionals and patients
Practical cases
Doctor Anywhere (DA) is a Singapore-
based start-up that has operated in Vietnam,
Singapore, and Thailand.
It offers teleconsultation services in internal
medicine and paediatrics through a
smartphone application.
Jio Health is a company with bases in both
Vietnam and the US and run a telemedicine
app that enables ondemand access to
healthcare services such as
primary care and chronic disease
management.
BuyMed is a medical start-up in Vietnam that
seeks to tackle counterfeit drug issues. The
company operates Thuocsi.vn, a
pharmaceutical distribution marketplace, and
aims to simplify the pharmaceutical distribution
system in Vietnam and the rest of Southeast
Asia.

Consumer Health Electronics
Opportunities
 Remote patient monitoring solutions from providers are allowing people to communicate with their
doctors and track critical information from the comfort and convenience of their homes.
 This will free-up bed space, lower the cost of care, and allow for earlier discharge of low-risk
patients.
Challenges
 Wearable teach in Vietnam is not as common as it is in other markets.
 Wearables can be expensive, ranging from USD $30 to more than $300, while the
average monthly salary of a worker in Vietnam is approximately $265.
Key development milestones:
 The country’s urban youth, are integrating health technology into their lives,
driving wearable fitness and activity tracking technology.
 millions people in Vietnam now own some forms of wearable tech, including
Fitbits, Apple Watches, or Samsung Watches.

Healthcare Big Data and Artificial intelligence(AI)
Opportunities
 AI can be used in various ways to improve healthcare services
(e.g., day-to-day tracking, early detection of diseases, diagnoses,
and treatment planning).
 As AI and Big Data services are still underdeveloped in Vietnam,
there might be potential for EU providers of innovative solutions in
almost every application of AI.
Challenges
 Lack of government regulations: there is no legislation specifically
governing Big Data and AI health applications, apart from Decision No.
4888/QD-BYT.
 Other potential barriers to wider coverage of AI & Big Data applications:
 Accuracy of patient data interpretation/ standardised data
 Availability of qualified health care professionals that can use AI
products
 Quality and accuracy of current diagnoses that AI would be based on
 Might not be cost-effective especially in smaller regions
Practical case: IBM Watson for Oncology
 IBM’s Watson, an Artificial Intelligence (AI) system that
offers cancer treatment options based on details in a
patient’s medical records for oncology diagnosis and
treatment.
 Currently three hospitals in Vietnam that use IBM Watson
to assist the treatment of 13 types of cancer, namely:
 Phu Tho General Hospital
 National Cancer Hospital (K Hospital).
 HCMC Oncology Hospital

Impacts of climate change on urban areas
The urban system in Vietnam is often formed mainly in
river and sea coastal areas and it is especially sensitive to
the negative impacts of climate change.
In a pessimistic scenario, mean sea levels are estimated
to rise 30 centimeters by 2050 and 70 centimeters by
2100. This increases the exposure of urban areas to
intense flooding by 7 percent.
Municipalities in the Northern mountainous and hilly
region and the Central region are often affected by
extremely heavy rain and post-storm circulation, which
cause floods, flash floods and landslides.
Droughts and floods also affect the urban water supply
system but the impacts is only at the medium or low level.

Climate resilience scheme for urban areas
First phase (2021-2025)  Implemented in 05 cities, namely Ho Chi Minh City, Hanoi, Can
Tho, Hai Phong and Da Nang, and
 Implemented in cities of 7 provinces located in the North Central
Coast, the Central Coast and the Mekong Delta and
 Implemented in cities of 7 provinces located in the Northern
Highlands and the Central Highlands.
03
01
02
Decision No. 438/QD-TTg dated March 25, 2021, approving the scheme for the development of climate-smart cities in Vietnam for 2021 – 2030.
 The scheme is set to be carried out from now until 2030 in 63 cities and provinces nationwide, with a focus on coastal and delta cities facing
the risk of flooding and cities facing a high risk of flash floods and landslides.
 The Scheme is formulated for three (03) periods starting from now to 2030 with a vision for after 2030.
Second phase (2026-2030)
 Implemented in coastal cities and delta cities at risk of flooding;
and at high risk of flash floods and landslides in provinces
whose cities suffer from new impacts of climate change
After 2030
 Implemented throughout the country.
Vietnam government encourage to mobilize funding
for pilot programs and projects from foreign investors
The government also encourage to implement
programs for
(i) scientific and technological research cooperation,
(ii) green growth and green architecture
(iii) smart urban development,
with experience learned from international experts.

Climate resilience scheme for urban areas - Practical cases
The project officially kicks off in February, 2022
 Duration of project: 2021 - 2025
 Sponsors: Agence Française de Développement, EU
 Value: EUR 36.33 million
 Investment content:
 Construction of 14 km anti-erosion embankment on Nam Rom river, widening
the flow, dredging some river sections; building dams.
 Building the monitoring system; strengthening capacity for multi-disaster
management, climate change adaptation…
Project: Managing multiple natural disasters in the Nam Rom river area, in order to protect people's lives, adapt to
climate change and develop socio-economic in Dien Bien
 Objectives: managing multi-disaster risks related to water in order to minimize impacts, serve socio-economic development, adapt to climate
change:
(i) Improve capacity to respond to climate change and prevent natural disasters;
(ii) Preventing landslides, protecting the land, safety of people's lives and properties;
(iii) Strengthening the capacity of flood drainage and anti-flooding;
(iv) Domestic and industrial water supply;
(v) Limit migration, stabilize agricultural production, contribute to stabilizing people's livelihood and socio-economic development.

Climate resilience scheme for urban areas - Practical cases
 Duration of project: 2022 - ?
 Sponsors: Agence Française de Développement, EU,
Vietnamese Government
 Value: EUR 156 million
 Objectives: The project aims to reduce the vulnerability to
natural disasters in five urban areas, namely Phat Diem township
(Ninh Binh province), Ngoc Lac township (Thanh Hoa province),
Hoang Mai town (Nghe An province), and Huong Khe and Thach
Ha townships (Ha Tinh province).
 Investment content:
- Building urban infrastructure facilities to serve water drainage,
ease flooding, and improve environmental hygiene, clean water
supply, and solid waste treatment.
- Technical assistance to help the localities enhance the
project’s sustainability by boosting their capacity to operate and
maintain wastewater treatment stations and other utilities.
Improve the climate resilience of urban infrastructure in
four northern central provinces of Vietnam

PART 2 Conclusion
The Vietnamese Government has recently taken numerous actions to support, incentivize, or partner with the private sector
on mitigation and adaptation initiatives. Greening the economy will help create trade opportunities for many enterprises.
 Agtech still has much potential for private enterprises. They will benefit from applying and selling intelligent equipment,
machines, and innovative farming methods from the vast agricultural system in Vietnam.
 The transport sector, the implementation of traffic engineering projects focuses mainly on the state's role. Meanwhile,
Government incentives and the EV market's huge potential will promote the private sector's doing business in this area.
 In renewable energy production, , since the renewable energy equipment still mainly has to be imported, the relocation
of these manufacturers to Vietnam is also an investment opportunity for EU businesses.
 In the healthcare sector, climate change indirectly affects human health, so applying advanced technologies from EU
countries will help Vietnam's health system. Businesses with experience implementing these technologies in the EU will
also find excellent investment opportunities in the country of nearly 100 million people.
 In urban development, construction works in urban areas, especially coastal cities, are directly affected by climate
change. Therefore, the participation of the private sector in housing construction and urban planning to enhance the
resilience of this area is urgently needed.

Vietnam - Climate Change - Technologies - Trade and Investment under the EUVNFTA - what you must know!

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