Green Bonds Peaked Vietnamese Investment Community’s Interest

On March 26, 2021, Global Green Growth Institute (GGGI) Viet Nam and Vietnam Community of Investment Professionals (A CFA Society in formation) co-organized the webinar “Green Bonds – The fast-emerging market” to share international practices on Green Bond and insights into the Vietnamese market. Mr. Vinh Vo, CFA – Chairman of Vietnam Community of Investment Professionals – congratulated the webinar for its timeliness demonstrated through the overwhelming interest from the investment community.

Le Thi My Hanh, GGGI Viet Nam

Hanh Le, GGGI Vietnam Country Representative, welcomed the Government of Vietnam’s commitment on developing green bonds market.

The global green bond market has surpassed the USD 1 trillion cumulative issuance since its inception in 2007, an impressive growth. Simultaneously, the appetite from the emerging markets is also on the rise. In this context, in Viet Nam, multiple policies and action plans towards green and sustainable economic development have been promoted, including green strategies in financial market sector. Most recently, at the 7th Joint Meeting of the ASEAN Finance Ministers and Central Bank Governors in Brunei last month, Deputy Minister of Finance Tran Xuan Ha affirmed Viet Nam’s commitment in promoting green and sustainable financial markets, with top priority to accelerate the development of green bond market in Vietnam.

Opening the webinar, Ms. Hanh Le, GGGI Viet Nam Country Representative, welcomed the Government’s commitment.  “Viet Nam is a shining star in COVID response, but our economy is not exempted from the global downturn. This is a challenge but I also see an opportunity to build back better. GGGI stands by Viet Nam to support its implementation of a successful green recovery”, stated Ms. Hanh. Particularly, the “Viet Nam Green Bond Readiness Program”, implemented under the MOU signed between GGGI and the Ministry of Finance in October 2020, aims to develop the green bond market in Vietnam through policy advice, capacity building and technical assistance on actual Green Bond issuances.

Guest speaker – Srinath Komarina – shared results from GGGI Viet Nam’s Green Bond Market Survey in which 80% of surveyed banks in Viet Nam answered having limited awareness on green bonds.

International expert in green finance, Mr. Srinath Komarina – Program Manager of GGGI Viet Nam – claimed that 2020 marked the leap of Sustainable Finance, hitting a new record with the highest issuance in a year, at USD 732.1 billion (30% increase from 2019). Meanwhile, Green Bond grew to a record of USD 305.3 billion and Social Bonds jumped seven folds to USD 147.7 billion.

Implications from international and regional markets suggested that Green Bond has great potential in Viet Nam yet the market still lacks preferable conditions for green projects. Incentives from the government like tax exemption for coupon of Green Bond as well as local capacity building for Green Bond verifiers to decrease the issuance costs were some of the suggestions from domestic investor. Additionally, participants also inquired about the application of EU’s Sustainable Finance Disclosure Regulation in Viet Nam and the technicalities of rating Green Bonds.

Several questions and recommendations were raised to guest speakers during the Q&A session.

The webinar demonstrated peak interest for Green Bonds from the Vietnamese market. It would be followed by a series of trainings & webinars on different topics of Green Bonds including executive trainings on sustainable finance and capacity building for green bond issuers, investors and verifiers, within the framework of “Viet Nam Green Bond Readiness Program” implemented by GGGI Viet Nam and Ministry of Finance.

About CFA Institute

CFA Institute is the global association of investment professionals that sets the standards for professional excellence and credentials. The organization is a champion for ethical behavior in investment markets and a respected source of knowledge in the global

financial community. The end goal is to create an environment where investors’ interests come first, markets function at their best, and economies grow. CFA Institute has more than 178,000 active members in 162 markets, including 156 member societies. Vietnam has more than 270 CFA charterholders.