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With the prediction that the climate change will continue to address the economies all over the world, initiatives to cut down negative impacts on environment requires supports from economy and finance in particular. This research paper is structured to target the problems of green finance in Vietnam and adapt new solution from some developed countries. In Chapter 1, we go through the basic definition and theory related to green finance, as well as its components and the role of green finance in the economy. In Chapter 2, we research and synthesize the practices of green finance in four developed countries (Germany, France, China, and Japan) to draw on lessons learned for Vietnam. Chapter 3 of this study shall focus on the analysis of the current situation of green finance application in Vietnam as well as the challenges our countries faced in the process of applying green finance. The final chapter, in chapter 4, the research provides some recommendations for the government as well as enterprises related to green finance in Vietnam.
FOREIGN TRADE UNIVERSITY *** MIDTERM REPORT International Finance Green finance empirical analysis of some developed countries and reccomendations for vietnam Class: TCHE414 Instructor: Assoc Prof., PhD Mai Thu Hien Hanoi, June 2023 TABLE OF CONTENTS ABSTRACT .3 ACKNOWLEDGEMENT INTRODUCTION LITERATURE REVIEW .7 CHAPTER 1: THEORETICAL BASIS CHAPTER 2: PRACTICES OF GREEN FINANCE IN FOUR DEVELOPED COUNTRIES 17 CHAPTER 3: PRACTICES OF GREEN FINANCE IN VIETNAM 43 CHAPTER 4: RECOMMENDATIONS FOR VIETNAM 52 CONCLUSION 56 REFERENCES 57 LIST OF TABLES AND FIGURES Figure Changes in environmental concerns for the French population 17 Figure Trends in local environmental concerns 18 Figure French's spending on sectors 19 Figure Spendings on buildings 20 Figure Spending on transport 21 Figure Spendings on energy 22 Figure Spendings on adaption 23 Figure Spending on pollution 23 Figure Global carbon emissions (gigatons) .31 Figure 10 Average electricity tariff 46 Figure 11 Components of EVN’s Debt by Currency in 2016 48 Table China's key policies 34 ABSTRACT With the prediction that the climate change will continue to address the economies all over the world, initiatives to cut down negative impacts on environment requires supports from economy and finance in particular This research paper is structured to target the problems of green finance in Vietnam and adapt new solution from some developed countries In Chapter 1, we go through the basic definition and theory related to green finance, as well as its components and the role of green finance in the economy In Chapter 2, we research and synthesize the practices of green finance in four developed countries (Germany, France, China, and Japan) to draw on lessons learned for Vietnam Chapter of this study shall focus on the analysis of the current situation of green finance application in Vietnam as well as the challenges our countries faced in the process of applying green finance The final chapter, in chapter 4, the research provides some recommendations for the government as well as enterprises related to green finance in Vietnam ACKNOWLEDGEMENT Before going into the main content of the essay, group would like to express our sincere gratitude to the lecturer in charge of the subject, Assoc Prof Dr Mai Thu Hien, who has accompanied us in the idea development process and advised us to write the outline of the essay Your in-depth lectures are the source of inspiration for us to implement this topic and also help us to build the foundation and develop the direction of the essay However, due to the lack of expertise because all members of the group are not students majoring in the Department of Finance and Banking, this essay may have some flaws and shortcomings Our group hopes to receive your profound comments and guidance to help us further improve the quality of our essay content in the future Once again, we sincerely thank you Lastly, we would like to wish you plenty of good health and contentment as you carry on your noble mission of passing knowledge on to future generations of Foreign Trade University students Best regards, Group INTRODUCTION Rationale For the foreseeable future, climate change is likely to remain the defining political and economic issue of this century On a global scale, governments, businesses, investors, and private citizens have begun taking steps to address the climate crisis, particularly with regard to decarbonization techniques In order to support initiatives that cut GHG emissions and help businesses adapt to the effects of climate change, the transition to a low-carbon or green economy would require a substantial amount of new capital investment, particularly in the form of green financing Green financing benefits both the economy and the environment It boosts individuals' and businesses' access to environmentally friendly goods and services, equating the transition to a low-carbon society and resulting in more socially inclusive growth This creates a 'great green multiplier' effect in which both the economy and the environment benefit, making it a win-win situation for everybody Given this, it's vital to comprehend what green finance is and why it matters In Vietnam nowadays, it can be assessed that the green financial market is in its infancy Market operations are mainly new at the start-up stage The green bond market is in the phase of pilot implementation, the implementation of propaganda programs, and the introduction of green bonds to subjects in the market The green stock market was launched and implemented most effectively by putting the VNSI index into operation at the same time as the regulations requiring listed companies to provide information about the environment, society, and community The government, as well as the ministry of finance and central banks, are working diligently to build a regulatory framework for green financing to be applied in Vietnam Above are the reasons why the authors conducted this report “Green finance: Empirical Analysis of some developed countries and Recommendations for Vietnam” to obtain the developed countries' experience in building the framework for green finance and provide recommendations for Vietnam Objectives The overall objective of this research is to investigate, summarize, and assess the application of green finance in developed countries Furthermore, we will provide a practical analyzation of the situation in Vietnam today on the basis of lesson learned from developed countries in order to clarify the present issue and provide recommendation for entities which related to green finance in Vietnam Objects and Scope The research issues related to the current state of green finance of four developed countries Specifically, we conduct a study on a national level of Germany, France, China and Japan Besides, the current development of Vietnamese green finance also has been under investigation to indicate the recommendation for Vietnam Methodology The authors collected data and information published in the media and professional reports, conducted qualitative research through collected data from all sources, from which process and analyze in order to draw specific conclusions about the current situation and challenges of green finance in Vietnam Structure Beside abstract, acknowledgement and references, the research paper includes parts: Introduction Literature review Chapter 1: Theoretical Basis Chapter 2: Practices of green finance in four developed countries Chapter 3: Practices of green finance in Vietnam Chapter 4: Recommendations for Vietnam LITERATURE REVIEW The term “green economy” was first coined in Blueprint in 1989 Since then, the twentieth century has started with the booming decades of the green economy The awareness towards the environment of humans has an increasing trend and creates a huge impact on how the economies all over the world function In academic field, research and professional papers conducted in this green economy topic have been widely developed However, with the object and scope narrowed down as green finance and Vietnam, respectively, researchers have only gone into detail after 2010 The four papers highlighted as followed can represent the process of academic research development about green finance in Vietnam In the perspective of inter-governmental organization, the Global Green Growth Institute (GGGI) launched the project “Enhanced Policy for Increased Green Finance in Vietnam” The main works of this project were developing and institutionalizing Investment Guidelines for Green Growth (IGGG), and developing a five-year CPF that aligns GGGI green growth work to the VGGS, and identifies the need for public and private finance for energy, transportation, and industrial infrastructure that is environmentally sound The project gained the outcomes in 2017 and 2018: - Develop a handbook and deliver training on the use of the Investment Guidelines for Green Growth in the appraisal of public investments - Establish coordination mechanism for financing and implementation of Vietnam Green Growth Strategy - Develop policy recommendations for a SME guarantee scheme for green businesses and submit to the government for approval - Government incorporates Investment Guidelines for Green Growth into public investment appraisal processes - National coordination mechanism for implementation of the Vietnam Green Growth Strategy is operational - Government adopts green criteria into the SME guarantee scheme to improve access to finance for green businesses A handbook on how to access green financing in Vietnam was also conducted and published by UNIDO in 2018 With a view to helping businesses overcome financial barriers in investment to apply clean and low carbon technologies, UNIDO and MPI partnered with the International Financial Company (IFC), Vietnam Development Bank (VDB), Vietnam Environment Protection Fund (VEPF), Vietnam Energy Efficiency for Industrial Enterprises project of World Bank (VEEIE), and HDBank in order to introduce available financial mechanisms to support investments in green technology, facilitating easy access to capital sources, investment support, direct assistance and preferential loans In the same year 2018, Asian Development Bank released the publication “Green Finance in Vietnam: Barriers and Solutions” Vietnam has made considerable strides in achieving a high percentage of nationwide electrification and a relatively diversified energy mix that is dominated by hydropower, followed by gas and coal To sustain these achievements including addressing gradually depleted domestic resources, keeping pace with growing energy demand from the energyintensive economy, and meeting ambitious climate change targets under the nationally determined contributions in the Paris Agreement, large sums of new investment are needed, particularly in renewables Without these investments, Viet Nam will increasingly rely on imported coal to cater to its future energy needs, with substantial negative environmental, health, climate change, and economic consequences Based on the existing challenges, the authors recommended establishing more conducive conditions for private investment and strengthening the domestic funding environment through a functional financial market CHAPTER 1: THEORETICAL BASIS 1.1 Definition Economists have used the term sustainable development to try to clarify the balance between economic expansion on the one hand and environmental conservation and protection on the other Sustainable development is defined as "meeting the needs of the present generation without jeopardizing future generations' needs." Thus, if the stock of capital assets, including land, remains stable or increases over time, economic growth will be sustainable It should be highlighted, however, that future economic development and quality of life are critically dependent on the natural resource base and environmental quality, i.e., the quality of land, water, and air Among sustainable development elements, green finance is the one we chose to focus on in this research paper First, looking at the broader scale, green finance is a component of the green economy According to UNEP, a green economy is defined as low carbon, resource efficient and socially inclusive In a green economy, growth in employment and income are driven by public and private investment into such economic activities, infrastructure and assets that allow reduced carbon emissions and pollution, enhanced energy and resource efficiency, and prevent the loss of biodiversity and ecosystem services We haven't had a precise and widely accepted definition of green finance until now for two reasons For starters, few publications attempt to define the word; for example, neither IFC (2013) nor Spratt and Griffith-Jones (2013) offer a description of green finance.And second, the proposed definitions differ greatly The following are some of the few definitions found in the literature: Green financing is defined by Höhne / Khosla / Fekete / Gilbert (2012) as: "Green finance is a broad term that can refer to financial investments flowing into sustainable development projects and initiatives, environmental products, and policies that encourage the development of a more sustainable economy Green finance includes climate finance but is not limited to it It also refers to a wider range