Dialykinhte
Dialykinhte
Dialykinhte
Give overview about economic growth in Vietnam. What are the main
characteristics of Vietnamese growth model? Is it sustainable or not and what
are policy implications?
2020 witnessed the lowest annual growth rate in the period 2011-2020 (2.91%) due to the
complicated development of the Covid-19 pandemic. However, Vietnam is among successful
countries which had a positive economic growth rate.
The contribution of total factor productivity (TFP) saw an increase, on average in the
period 2016-2020 it is estimated at 45.42%, exceeding the set target (30-35%). Notably, in the
period 2016-2019, when not yet affected by the Covid-19 epidemic, TFP's contribution reached
nearly 46%, one and a half times higher than the previous period which is just around 33%.
Source: Statistical Yearbook of Vietnam 2020, General Statistics Office
Enhancing the quality of economic growth in Vietnam (Nguyen Ngoc Son, 2021)
→ In width: based on the input structure, the economic growth momentum of Vietnam in recent
years has still been based on the resource-intensive growth factors (accounting for over 50%), of
which capital is still the most important driving force.
However, there are signs of switching to in depth: the increase in the contribution of the TFP
(illustrated as the linear trend line on the figure). More significantly, according to the General
Statistic Office, “In the 2016-2020 period, TFP's contribution to economic growth averaged
45.42%, much higher than the average of 32.84% in the period 2011-2015”.
→ First characteristic of Vietnamese Economic Growth Model: develop in width, starting
to shift to in depth.
ICOR decreased from 6.42 in 2016 to 6.08 in 2019. On average, in the period 2016-2019,
the ICOR reached 6.13, lower than the figure of 6.25 in the period 2011-2015. We can see that
although the investment efficiency is showing signs of increasing when ICOR gradually
decreases in the period of 2016 - 2019 but it’s still high compared to our neighboring countries,
which suggests that our use of capital is still inefficient and unsustainable. Due to the severe
negative effects of the Covid-19 epidemic and flooding, we will not include the year 2020 in the
pattern. The economy cannot perform as well as it did previously under normal conditions
making the ICOR reach 14.28.
Labor (L):
Labor productivity:
Increasing labor productivity is the key factor in ensuring high-quality growth. The labor
productivity in Vietnam has remarkably grown by 5.02% per year in the period of 2011-2019.
However, it's still on the low spectrum among ASEAN countries.
Source: Enhancing the quality of economic growth in Vietnam (Nguyen Ngoc Son, 2021)
Participation in global value chains will provide Viet Nam with increased value creation, more
and better jobs, proper specialization and positioning in the global economy, and the spillover
effect of technology and management that raises domestic capacity (Taglioni & Winkler, 2016).
“Backward participation” is the amount of value added of inputs that were imported in
order to produce intermediate or final goods/services to be exported.
“Forward participation” is the amount of domestic value added contained in
intermediates (goods or services) exported to a partner economy that re-exports them to a
third economy.
“Participation in global value chains” is the sum of these two ratios.
The value-added components of gross exports and related GVC trade flows
Source: World Trade Organization
Year Forward participation Backward participation Participation in the GVCs
(%) (%) (%)
Source: Viet Nam productivity report 2021, Viet Nam: Trade in VA and GVCs, 2018 (World
Trade Organization)
Sign of growing assembly industries. Since the assembly activities in Vietnam are
continuously growing and devoted primarily to end-consumption goods, Vietnamese
products are consumed directly in third countries instead of being used as input supplies
(intermediary products) for another product. In other words, made-in Vietnam goods are
favored in foreign countries.
Achievement of the economic restructuring process, specifically, the transformation of
export, from raw materials (crude oil, coal and raw agro-products) to goods for
consumption with high production content.
→ Third characteristic of Vietnamese Economic Growth Model even with active foreign
trade and FDI, Viet Nam’s participation in global value chains is limited and does not
augment domestic value very much.
• Improving the quality of human resources Human capital development is the most important
factor to ensure long-term economic growth and poverty reduction. Therefore, there should be
solutions to improve the quality of education and training as follows: The key solution is to
renovate and improve state management capacity in education and training. Comprehensive
education reform aims to bring the education system in line with the country’s economic
development requirements. Increasing investment in education through various sources, of which
investment from the state budget should increase. Support and accelerate digital transformation
in the business sector through policy breakthroughs. Take advantage of Industry Revolution 4.0
to promote science and technology development, innovation and labor productivity.
• Improving the capital efficiency In order for the economy to grow, Vietnam not only needs to
increase investment but also use capital effectively. Therefore, on the one hand, it is necessary
to promote the investment ability of the people and the private sector, attract more foreign direct
investment. On the other hand, it is necessary to improve the efficiency of the use of state
investment, prevent ineffective investment, and fraudulent investment.
• Improving the quality of institutions: Continue institutional reform and improve the
business environment are the core and most important factors that create new driving forces for
economic growth. Strengthening institutions of market mechanism, effectively mobilize them in
line with the socialist-oriented market economy of Vietnam; Strictly applying the principles of
publicity and transparency in the processes of management, exploitation and use of the country’s
resources; Reforming and improving the quality of socio-economic development strategies;
Develop and strictly impose strong sanctions that help prevent actions towards authoritarianism
and monopoly, the ask-for-the-given mechanism, group benefits;...
CONCLUSION
Although Vietnam has attained very encouraging economic development achievements, it is still
growing below its potential and is currently facing many quality-related shortcomings in the
medium and long term. Therefore, removing bottlenecks on both quantity and quality growth is
essential for Vietnam to close the development gap with other countries in the region and the
world.
REFERENCE LINKS
1. https://www.gso.gov.vn/wp-content/uploads/2021/06/Dong-thai-va-thuc-trang-2016-
2020.pdf
2. https://www.grips.ac.jp/teacher/oono/hp/docu03/Viet%20Nam%20Productivity%20Report
%202021.pdf
3. https://www.ilo.org/wcmsp5/groups/public/---asia/---ro-bangkok/---ilo-hanoi/documents/
publication/wcms_730825.pdf
4. https://www.gso.gov.vn/wp-content/uploads/2021/07/Sach-NGTK-2020Ban-quyen.pdf
5. https://vietnamjournal.ru/2618-9453/article/view/87080
6. https://www.wto.org/english/res_e/statis_e/miwi_e/vn_e.pdf
7. https://www.wto.org/english/res_e/statis_e/miwi_e/explanatory_notes_e.pdf
Group Presentation 2.
Present the economic productivity in Vietnam and make comparison with
those of the world? What should we do to improve our productivity?
1. Basic concepts: (chuyển) -> chiếu vid -> (chuyển)
Productivity: Productivity is a crucial concept in economic growth and welfare. There are
some nations richly endowed with natural resources such as oil, gas, diamond, But most
other nations devoid of such a given advantage, including Viet Nam, must accumulate
knowledge, skills, and technology to climb the industrial ladder. For such nations,
attaining high income and improving productivity is essentially the same thing. That is
why productivity enhancement is critical for Viet Nam’s socio-economic development.
(chuyển)
Labour productivity: measures the number of goods and services a unit of labor can
produce in a given period of time (usually an hour). Improving labor productivity would
obviously require an increase in the number of goods and services labor could produce.
These could be gained by increased education and training. Additionally, improvements
in production methods, technology and capital would make labor more efficient and more
productive. (chuyển)
TFP: This is the amount of output that is not explained by the number of various inputs
used in production, showing effectiveness in the utilization of inputs. (chuyển)
Quality: In manufacturing, a measure of excellence or a state of being free from defects,
deficiencies, and significant variations. (chuyển)
Innovation: Innovation is a process by which a domain, product, or service is renewed
and brought up to date by applying new processes, introducing new techniques, or
establishing successful ideas to create new value. (chuyển)
- Vietnam’s labor productivity evolved in three distinct stages: high growth (1991-95),
stagnation (1996-2012) and recovery (2013-).
(chuyển)
- In the first stage, Vietnam steadily eliminated barriers to market and decisively
integrated into the international community.
This was a revival of economic growth from past suppression and returning to the path which
the nation was supposed to tread.
- In the second stage starting from the mid-1990s, productivity growth slowed down. The
Asian financial crisis in 1997-98 and the global financial crisis in 2008-09 disturbed the
Vietnamese economy.
- In the third stage, the situation began to improve and productivity growth approached
the speed in the first stage (until the COVID-19 pandemic hit the national as well as global
economy in 2020). (chuyển)
2.2 Productivity by economic activity
(biểu đồ, bảng 2.2) In general, labor productivity of three main economic sectors—(i)
agriculture, forestry, and fisheries; (ii) industry and construction; and (iii) services
(chuyển)
Among them, agriculture, forestry, and fisheries had the lowest labor productivity in absolute
level while industry and construction had the highest labor productivity. The latter sector
includes activities with high labor productivity such as mining and certain manufacturing. These
three activities have each improved significantly over the years). (chuyển)
- (You can see in this graph, Vietnam is the red line) Our productivity was the lowest in
manufacturing; construction; and transportation, storage, and communications.
Viet Nam has worked on productivity for many decades. Even so, the results of many
policies remain ineffective. The productivity movement of Viet Nam has so far been
small, scattered, and only partially implemented.
If workers, managers, and responsible government officials do not possess the right
attitude and dedication to absorb new knowledge and work hard for improving efficiency,
any productivity tool will prove useless because it is learned only superficially and soon
forgotten. Learners must have a strong internal urge to adopt new tools.
KB:
In recent years, Việt Nam's labor productivity has increased in both value and speed, making
important contributions to the country's socio-economic development. Despite improvements,
Việt Nam's labor productivity is still considered low compared to other countries in the region
and around the world. Improving labor productivity is the shortest way to help the economy
develop rapidly, and sustainably and catch up with the development levels of other countries in
the region. This needs the participation of all levels, sectors, and society to raise awareness.
Questions:
Q1: Why is Việt Nam's labor productivity still considered low compared to other countries
in the region and around the world?
-> Some of the main reasons leading to this situation are the small size of our economy
and slow economic restructuring. In addition, although the process of economic and
labor restructuring has gained positive achievements, it is still slow. Labor restructuring
is happening relatively fast but the labor force in agriculture, forestry, and fishery is still
large. The majority of laborers in these sectors are unskilled and seasonal with unstable
jobs, resulting in low added value and low labor productivity.
-> A labor productivity index can be calculated by dividing an index of output by an index
of hours worked. When more than one index is included in a calculation, all the indexes must
have the same base period.
Group Presentation 3.
Please describe the current state and forecast of energy use in Vietnam. What
factors influence the increase in energy demand in the short and long term?
Present proposals to contribute to sustainable energy supply in Vietnam.
BASIC CONCEPTS
Energy is the ability to do work
Scientists define energy as the ability to do work. Modern civilization is possible because people
have learned how to change energy from one form to another and then use it to do work. People
use energy to walk and bicycle, to move cars along roads and boats through water, to cook food
on stoves, to make ice in freezers, to light our homes and offices, to manufacture products, and to
send astronauts into space.
There are many different forms of energy, including:
Heat
Light
Motion
Electrical
Chemical
Gravitational
These forms of energy can be grouped into two general types of energy for doing work:
Potential or stored energy
Kinetic or working energy
Energy can be converted from one form to another. The stored chemical energy in coal or natural
gas and the kinetic energy of water flowing in rivers can be converted to electrical energy, which
in turn can be converted to light and heat.
Energy sources can be categorized as renewable or nonrenewable
There are many different sources of energy, which can be divided into two basic categories:
Renewable energy sources: Renewable energy is energy from sources that are naturally
replenishing but flow-limited; renewable resources are virtually inexhaustible in duration
but limited in the amount of energy that is available per unit of time.
The major types of renewable energy sources are:
Biomass
o Wood and wood waste
o Municipal solid waste
o Landfill gas and biogas
o Biofuels
Hydropower
Geothermal
Wind
Solar
Nonrenewable energy sources: When these sources are used up, they cannot be replaced,
which is a major problem for humanity as we are currently dependent on them to supply
most of our energy needs
Renewable and nonrenewable energy sources can be used as primary energy sources to produce
useful energy such as heat, or they can used to produce secondary energy sources such as
electricity and hydrogen.
DESCRIBE
Context
According to Institute of Energy of Vietnam (IEV), Vietnam is set to face a surge in power
demand and consumption over the coming decade, which will have an impact on its energy
security. The Government of Vietnam expects power consumption to grow 10-12 percent
annually through 2030, one of the fastest power consumption growth rates in Asia.
In the capacity structure of the national power source in 2020, coal-fired power accounts for
about 33 percent, hydroelectricity accounts for 29 percent, gas turbines and oil-fired thermal
power accounts for 14 percent, and solar power (including rooftop solar power) accounts for 23
percent, and others about 1 percent (wind power, biomass power, import of hydroelectricity
from Laos). Maximum load capacity of the power system in 2020 is about 38.7 GW, The crude
reserve ratio of the power system (excluding wind and solar power) is 34.3 percent.
Accordingly, electricity capacity is expected to increase by an annual average of 5.7 percent
between 2021 and 2030, totaling 129.5GW by 2030. It also sets out USD 148 billion worth of
investments to increase power generation and develop the electricity network, of which 74
percent is to be directed to power sources and 26 percent to grid development for 2021 – 2030.
Coal thermal power: Vietnam is seeking to reduce coal-fired thermal power from 34
percent of its power source in 2020 to 27 percent in 2030. Despite increasing pressures
on its environmental impact, coal will remain the most practical option in the near term
to stimulate affordable electricity generation growth at the pace and scale needed by the
country. However, during this period, there will be no additional development of new
coal-fired thermal power. The Draft PDP8 suggested that only on-going coal-fired
thermal projects currently under construction and under investment promoted for
operation during the 2021-2025 period is included in the PDP8.
In the PDP8, the MOIT proposes to continue ctricity from major power source centers in the
Central Highlandsbuilding a 500kV power transmission system to transmit ele, South Central
Coast, and North Central region to major load centers of Vietnam. Ho Chi Minh City and Red
River Delta to strengthen the interconnected transmission grid to support the North-Central-
South power transmission.
Accordingly, in the period between 2021 – 2030, the country will need to build a total of about
86 GVA capacity of 500kV station and nearly 13,000 km of DMZ. With this grid development
program, Vietnam’s power grid initially meets N-1 criterion for power supply for loads and N-2
criterion for particularly important loads.
Vietnam has a favorable geographical location and convenient LNG transportation route
including many deep-water ports and existing gas infrastructure systems that can be used.
Developing the LNG sector is an inevitable trend for Vietnam to diversify fuel sources for
electricity generation and contributing to ensuring energy security for Vietnam.
The Vietnamese government highlighted the use of LNG as a source for power generation and
will look to create more favorable conditions for foreign investors to develop such projects
given depleting domestic gas resources and rising investor interests in LNG projects. By the
end of December 2020, there were about 26 GW of gas-fired power capacity projects in the
pre-FID phase in Vietnam.
2. Renewable Energy
The PDP8 prioritizes the development of solar and wind power sources in large scale.
The ratio of renewable energy (excluding hydropower) in the PDP8 has increased to almost 30
percent in 2030. The PDP8 expects that by 2030, onshore and near-shore wind power will
develop an additional capacity of 9 GW, offshore wind power will develop an additional
capacity of 2-3GW, solar power will develop an additional capacity of 7GW, biomass power
will be reduced by 0.5 GW, and small-scaled hydropower will be reduced by 1.8 GW.
2.1) Offshore WindPower (at an area with a seabed depth of over 20m):
The Vietnamese government has also proposed several policies in recent months to boost the
development of the wind energy sector. The current FiTs for offshore wind is highly attractive
at 9.8 US cent/kWh which were increased from the previous rate. Because of difficulties
caused by he COVID-19 pandemic the FiT was extended from the original COD deadline in
November 2021 to the end of 2023.
In the PDP8, Binh Thuan, Bac Lieu and Ca Mau were highlighted as prioritized provinces for
offshore wind development. Up to December 2020, many investors registered to research and
invest in the South Central region with the total scale up to about 36 GW. Along Vietnam’s
coastline, high wind areas with good economic potential are only located in the South Central
region with total potential is about 80GW.
The total technical potential of solar power is very large at up to 1646GW. The total scale
potential for development of large-scale solar power nationwide is about 386GW, mainly
concentrated in the South, the South Central region, and the Central Highlands.
The theoretical potential of biomass energy in Vietnam from the combustion of rice husk, rice
straw, corn cob, cassava stalk, bagasse, and sugar cane waste is estimated at more than 2,500
MW.
For renewable power sources, the government has launched the Direct Power Purchase
Agreement (DPPA) pilot program, where renewable energy producers can sell and deliver
electricity directly to corporate customers. The size of the DPPA program is expected to range
from 400 to 1,000MW, and will be implemented nationwide from 2020 to 2022.
Opportunities
Opportunities are promising in offshore exploration and production technologies, equipment
and services; engineering steel fabrication; LNG supplies, LNG infrastructure; and
petrochemical technologies and equipment.
USTDA has funded nearly 80 activities valued at USD 20 million in Vietnam over the last 20
years. Vietnam represents the agency’s largest country portfolio in Southeast Asia. Through
feasibility studies, technical assistance and pilot projects, the USTDA Project Development
Program helps oversee project sponsors, identify technological solutions, and various sources
of financing for priority infrastructure projects
Vietnam is one of the Southeast Asian countries with rapid GDP growth, from 6.5-7% annually,
leading to an average increase in energy demand of 11% per year. So, we will discuss some
factors that influence the increase in energy demand both in the long term and in the short term.
Another factor can be technology, especially electric vehicles. According to the Vietnam
Registry, the number of electric vehicles (EV) registered in Vietnam was slightly more than
1,000 units by the end of 2020. Moreover, by July 2021, VinFast installed 500 EV charging
stations and plans to have 2,000 charging stations set up nationwide with over 40,000 charging
ports by the end of 2022. Therefore, Vietnam needs a lot of energy such as renewable energy
(wind and solar power) to meet the demands of the electric cars industry.
This strong growth may be, in part, due to low energy prices and substitution of primary fuels
for other inputs such as labor and capital. Both primary energy and electricity power for
industrial and civil sectors in Vietnam are relatively cheaper than are those in other countries in
the region (Australian Energy Council 2019)—the legacy of the exploitation of hydropower,
which has very low operating costs, as the main energy source and large implicit subsidies of
fossil fuel extraction and consumption. In recent years, the coal price has increased by 40%,
forcing customers to shift from fossil fuel to using more electricity (United Nations Development
Programme 2019).
The population growth
In general, our consumption of natural resources increases as the human population expands.
More humans consume more freshwater, more land, more clothing, etc. The more people on the
planet, the more food you need to feed those humans (more fishing, more farming, more
deforestation to make room for agriculture and raising livestock, and so forth). Variation in
population size corresponded to variation in energy consumption at double the rate. That is, for a
20% increase in population size, energy consumption increased by 43.6%; conversely, for a 20%
decrease in population size, demand for energy decreased by 44.6%.
PROPOSALS
Facing those issues, Vietnam also offers solutions to contribute to sustainable energy supply: In
2015, the government announced the first-ever national development strategy for renewable
energy, aiming for renewables to account for around 32% of total primary supply and
electricity generation by 2030. Now the real problem is how can we do that.
1. Hydropower
Vietnam's energy system still relies heavily on coal and hydroelectricity, therefore, pumped
storage hydropower can be considered the next future for Vietnam's energy transition. With the
completion of the Long Biên power plant in 2017, Vietnam is well positioned to meet its
ambitious target of producing 7,000MW of electricity from renewable energy sources by inc (in
fact, we did). This mega project is expected to reduce the country's reliance on fossil fuels and
reduce carbon emissions. In fact, a report by the World Wildlife Fund found that thanks to this
and other ongoing hydropower projects, Vietnam's current generation mix is already more
carbon-efficient than its neighbors.
Furthermore, pumped storage hydropower enables the balancing of supply and demand without
transmission losses in case of peak load demand by storing the water at lower levels during off-
peak hours.
However, in order to take full advantage of its hydro potential, Vietnam must increase
investment in grid infrastructure and develop markets for excess electricity. This will go a long
way toward achieving the government's goal to produce 30 percent of its energy from
renewable sources by 2030.
The solution to this problem is to develop a power transmission system to not only distribute
electricity to the areas in need but also to avoid the situation of "oversupply" when developing
the power network.
In detail, the development of wind power and solar power is mostly done in the Central and
Southern regions - where the natural conditions are more favorable, and since the greater power
consumption is from the North, therefore, with a developed power transmission system, we can
move excess energy from the Central to the North.
3. Biomass
Biomass is another source of renewable energy in Vietnam. The country currently produces an
estimated 8 million tonnes of biomass each year, mostly from rice straw and sugarcane.
As Vietnam's agricultural sector grows, the demand for biofuel will increase.
Biofuels such as ethanol can be blended with gasoline to power vehicles or burned to generate
electricity using conventional combustion methods.
This approach can ease the burden on traditional fuels and help to reduce emissions. The
government has also encouraged the use of biogas as an alternative energy source for domestic
use.
However, as with other renewable energy sources, sustainable production of biomass is limited
by the government's ability to access sufficient land and resources. A carbon tax should also be
imposed to promote the consumption of clean energy sources and encourage the development
of a cleaner economy.
SUM UP
Factors in short term
Climate change and technology
Factors in long term
expanding industrial and construction sectors and population growth
And in the end, we suggested some solution
investment in grid infrastructure and develop markets for excess electricity
(hydroelectricity)
(Wind and solar power) develop a power transmission system
Government has to enlarge access sufficient land and resources for increasing and
stablizing the production of biomass energy
Group Presentation 4.
Give overview of climate change status and trend in Vietnam? Identify the
impacts of climate change to Vietnam’s economy? Policy implications for
mitigation and adaptation of climate change in VN?
CLIMATE CHANGE / VIETNAM'S ECONOMY
I. Overview:
1. Definition:
Climate change is a long-term shift in global or regional climate patterns. Often climate change
refers specifically to the rise in global temperatures from the mid-20th century to present.
The Earth’s atmosphere consists of gases such as oxygen, nitrogen and other gases known as
greenhouse gases like carbon dioxide, nitrous oxide and methane. Incoming light from the Sun
hits the Earth’s surface. The Earth absorbs some of that energy, heating the surface of the planet,
the rest of that energy gets reflected. Some of that energy goes back on into space. The
greenhouse gases like carbon dioxide trap the energy and send it right back to the Earth’s surface
heating it up even more. This is known as the greenhouse effect. Now a little greenhouse effect is
natural to the Earth and is a good thing to have but a large greenhouse effect can be catastrophic
causing a lot of that energy to stay in our atmosphere and heat up the Earth at an accelerating
rate.
So how did all these human activities affect climate change? According to an
ongoing temperature analysis led by scientists at NASA’s Goddard Institute for
Space Studies (GISS), the average global temperature on Earth has increased by
at least 1.1° Celsius since 1880 (14°C to >15.1°C). And as you can see in this
map, Vietnam’s temperature last year was more than 1°C hotter than the 1951-
1980 average. However, even the slightest change in these boundary conditions
represents a much larger shift for the chaotic weather system. So this 1°C change
might seem like a minor shift, but it has added the energy equivalent of roughly 1
million nuclear warheads into the atmosphere.
According to the Department of climate change of Vietnam, I have summarised
this graph to show the average temperature change compared to the period 1980-
1999 under the average emission scenario.
Year
The hotter temperature causes the rise of sea level unstoppably. According to the
data of Hon Dau national station, during 50 recent years, the sea level has
increased approximately 20cm. And if this situation persists, when the sea level
rises another 100cm, Vietnam will lose 40,000 km2 of land. According to the
2020 version of the Climate Change Scenario, if the sea level rises by 1 metre, it
will engulf 47.29% of the Mekong Delta area, about 17.15% of the area of Ho Chi
Minh City, 13.20% of the area of HCMC. area of the Red River Delta
Extreme weather:
The massive surge of energy has already led to a dramatic increase in a number of
extreme climate events and natural disasters like heatwaves, droughts and storm
surges. In the summary of the National Steering Committee on natural disaster
prevention and control you can see in this table.
In addition, the extreme weather events have occured more and more seriously
from year to year
Ngoài ra hiện tượng khí hậu cực đoan và thiên tai xảy ra ngày càng nhiều và
nghiêm trọng qua từng thời năm. Trong tổng kết của Ban Chỉ đạo Quốc gia về
phòng, chống thiên tai, tính từ đầu năm 2021 đến nay Việt Nam đã xảy ra 9 cơn
bão, 3 áp thấp nhiệt đới trên Biển Đông, 109 trận động đất nhẹ, 316 trận mưa đá,
dông lốc, sét; 140 trận mưa lớn, lũ cục bộ, trong đó 9 trận lũ ống, lũ quét, 157 vụ
sạt lở bờ sông, 7 đợt nắng nóng và 6 đợt không khí lạnh, gió mùa đông bắc.
Trend: Kịch bản cho vài chục năm nữa :) Sea level rise scenarios for the coastal areas of
Vietnam
II. The impacts of climate change on Vietnam's economy (add rainfall)
1. Agriculture
Agricultural losses due to climate change in Vietnam are projected to reach 10.6
percent by 2050, depending on the climate scenario.
Notably, without climate change, Vietnam’s overall agricultural output would be
projected to increase by 36 percent by 2050.
→ Climate change impacts would deprive Vietnam of a large share of its
agricultural productivity gains. Reduced crop yields could also lead to higher food
prices, with particular impacts on low-income people.
Reasons caused the loss of agriculture
- The rise of sea level
First, flooding will cause the loss of arable land in agriculture. If
the sea level rises by 1m, it is estimated that about 40% of the
Mekong Delta area, 11% of the Red River Delta area and 3% of
the area of other coastal provinces will be flooded.
⇒ As a “Doomsday Report”, the study suggests that Vietnam’s Ho Chi Minh City
could be underwater by 2050 and millions of people in Vietnam’s Mekong Delta
—the country’s main rice-growing region—could be forced to flee coastal areas.
Extreme weather
Drought (and lack of irrigation water) will affect the distribution of crops,
especially reducing yields, namely, the rice yield of the spring crop tends to
decrease more sharply than the other rice yield of the crop; winter corn yields tend
to increase in the Northern Region and decrease in the Central and Southern
Regions.
Typhoon
The 2020 typhoon season was particularly brutal. Vietnam faced at least seven major
storms, triggering torrential rainfall, major flooding, numerous landslides and massive
coastal erosion.
The string of storms in 2020 triggered “some of the worst [flooding] we have seen for
decades” according to Nguyen Thu Xuan Thu from Red Cross Vietnam. Altogether, the
floods left 178,000 houses submerged, nearly 700,000 poultry and livestock killed and
masses of food crops destroyed. UNICEF reported that, as the sanitation facilities were
damaged by the typhoons, the people in the area were left with no access to clean water
for drinking, washing or cooking.
The storm critically damaged much of the infrastructure in the region, with hospitals and
health centres damaged or destroyed, leaving many without vital health services.
⇒ Instead of using money to develop and expand the economy, Vietnam needs to spend
more money to restore the loss caused by climate change.
⇒ But this was only the beginning of the crisis. Vietnam is likely to continue facing extreme
weather conditions from now to 2050. Accordingly, temperatures in northern Vietnam will rise
by between 0.83.4 degrees Celsius by 2050 and continue its uptrend during the late 21st century.
The surging frequency of hotter days is forecast to severely hamper agricultural production.
Summer rainfall will decline in most areas. Meanwhile, storms may become rarer but fiercer,
causing possible flash floods and landslides in flood-prone areas of northern mountainous,
central and central highland provinces. The high resolution forecasts suggest sea level rises of
100mm–400mm along the entire Vietnamese coast by the end of the 21st century. If climate
change still continues in Vietnam, 5% of our country’s land, 11% of its population would be
affected with the losses estimated at 10% of GDP per year.
2. Industry
Sea level rise of about 1m by the end of the 21st century will cause most coastal industry to be
flooded, the lowest is over 10% of the area, the highest is about 67% of the area.
Raw materials for industry, especially raw materials for food processing, textile and garment
industries, will be significantly reduced because they are not supplied from raw material areas in
the Mekong Delta provinces, which are the most heavily flooded in Vietnam. This further
pressures the restructuring of industries in terms of industry type, processing industry rate, and
high technology.
Rising temperatures increase energy consumption in industries: increase the cost of ventilation,
underground cooling and reduce the efficiency and output of power plants. Electricity
consumption for living increases and cooling costs in commercial industries also increase
significantly as temperatures tend to rise.
3. Forest
The forest sector contributes significantly to the country’s economy.
In addition, the forest provides a myriad of goods and services that support local
livelihoods and the economy. Given the geography of the country, forests play a
particularly critical role in watershed and coastal protection.
Besides employment and timber and non-timber products, forests provide a range of
environmental services involving water resources, biodiversity, and climate protection.
Forests are a means for delivering adaptation measures, and well-planned and protected
coastal forests can deliver adaptation and economic benefits. Through the hydrological
cycle, forests help protect watersheds and their vegetation, water flows, and soils, and
store vast amounts of genetic information. Mangrove forests are particularly important in
protecting coastlines by reducing exposure to flooding and erosion. They are also some of
the most carbon-rich forests in the tropics, contributing to climate change mitigation.
As we mentioned before, deforestation causes climate change, and climate change affects
back to the forest directly.
Changing temperature, extreme weather, and precipitation patterns and increasing
concentrations of atmospheric CO2 are likely to have significant impacts on both natural
and degraded forests. Forest fires, insect outbreaks, wind damage, and other extreme
events are expected to impose substantial economic costs on the forest sector. Climate
change has a negative impact on the poorest forest-dependent communities, which lack
adaptive capacity because of poverty, marginalisation, and geographic isolation.
⇒ If we do not take action, we will lose our fertility forest, which contributes
significantly to Vietnam' s economy.
III. Policies
Solution: adaptation (minimze impact) + mitigation (cut down GHG)
Despite the name, I won’t make a list of policies, but I will give you guys information about
Vietnam's commitment to deal with climate change, our challenges in execution and
recommendation. We hope this information will be helpful navigation for you guys as future
decision makers
The ministry of human resources and environment has contributed VND950 trillion to the State
budget. In 2020, revenue from land-related fields was doubled compared to 2015.
Policies on climate change adaptation were proposed in the period, contributing to minimising
damage from natural disasters. The level of damage, triggered by saltwater intrusion in 2019-
2020, was 9.6 percent lower than the level of damage caused by saltwater intrusion in 2016.
But according to Minister of Natural Resources and Environment Trần Hồng Hà: “The things we
have done over the years are just building the initial foundations for the development.”
2. Commitment
To continuing our efforts, Vietnam also took part in international conferences, amongst
which, the most significant and recent one is COP26 (United Nation Climate Change
Conference)
In 2021, the Vietnamese Government delegation led by Prime Minister Pham Minh
Chinh attended the conference, achieving good results. The Prime Minister emphasized
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.
Vietnam made a commitment to develop and implement measures to reduce greenhouse
gas emissions to achieve net zero GHG emissions by 2050.
Also at COP26, Vietnam, together with more than 100 countries, promised to end
deforestation and reduce methane emissions by 30% compared to 2020 by 2030.
In addition, Vietnam has also committed to ending all investment in new coal-fired power
generation, expanding the scale of renewable energy deployment, and gradually phasing
out coal-fired power by the 2040s.
3. Challenges
These efforts are paving the way for further actions, but three challenges require immediate
attention:
All the new strategies and Vietnam’s NDC need to be updated to reflect recent
commitments, including those made at COP26. For example, the net-zero carbon
emission target has yet to be factored into any national or sectoral strategies.
The new commitments and strategies, prepared by different ministries, set targets and
priorities in inconsistent ways, complicating the vision and potentially hindering
implementation.
For example, the NDC defines the mitigation target as a reduction in GHG emissions,
while the VGGS targets the carbon intensity of GDP. Carbon intensity is a measure of
how much CO2 we emit when we generate one dollar in our economy. A rapidly
decreasing carbon intensity is good news for our environment. But the question here
is how to reduce the amount of CO2 we emit but not slowing down the growth of GDP
4. Recommendations
We’d like to propose that Vietnam shift its development paradigm by incorporating two
critical pathways – resilient pathway and decarbonizing pathway
Adaptation measures should focus on the country’s most vulnerable sectors and locations,
particularly agriculture, transport, trade and industry, coastal areas, and the Mekong
Delta.
Complementary policy reforms in the fiscal and financial sectors will be needed to
stimulate the necessary investments from both the public and private sectors.
Total financing needs are estimated at around $254 billion from 2022 to 2040, including
$219 billion for upgrading private assets and public infrastructure, plus $35 billion for
social programs.
Q1: How can you estimate the finance for both of the pathways you mentioned?
Actually all these numbers are not our own estimation but are referred to from the
Vietnam Country Climate and Development report. However, as far as I know, these numbers
are based on the cost of the previous period and also from the cost that other countries had to
pay. This estimate was also obtained by considering the difference between the financing needs,
and existing adaptation related expenditures.
Q2: We all know that the covid-19 pandemic to some extent helped clean the
environment by reducing the number of transportation during lockdown. So, did the
pandemic also mitigate the impact of the climate change situation in Vietnam?
Yes, although the Covid-19 "pandemic" did not affect climate change much, it only
temporarily reduced emissions from human activity and travel. These impacts do not cause the
earth's climate to change significantly, nor do they provide sustainable, long-term effects. But
the Covid pandemic erupted as a warning bell for people to take urgent and effective measures
to respond to climate change. Vietnam in particular and the globe in general are still in the
process of making efforts to restore and protect the green color of the Earth.
Group Presentation 5.
What is green growth? Why should Vietnam implement green growth? What are
the key points of the Green Growth strategy of Vietnam? Identify challenges for
implementing green growth in Vietnam and policy implications.
Outline:
1. Definition/ khung lý thuyết (Vinh)
1.1. Definitions of green growth
1.2. Các definitions liên quan green growth (research thêm, nếu có thì add vào. VD như
các loại chỉ số kinh tế liên quan,..)
BASIC CONCEPTS
Energy is the ability to do work
Scientists define energy as the ability to do work. Modern civilization is possible because people
have learned how to change energy from one form to another and then use it to do work. People
use energy to walk and bicycle, to move cars along roads and boats through water, to cook food
on stoves, to make ice in freezers, to light our homes and offices, to manufacture products, and to
send astronauts into space.
There are many different forms of energy, including:
Heat
Light
Motion
Electrical
Chemical
Gravitational
These forms of energy can be grouped into two general types of energy for doing work:
Potential or stored energy
Kinetic or working energy
Energy can be converted from one form to another. The stored chemical energy in coal or natural
gas and the kinetic energy of water flowing in rivers can be converted to electrical energy, which
in turn can be converted to light and heat.
Energy sources can be categorized as renewable or nonrenewable
There are many different sources of energy, which can be divided into two basic categories:
Renewable energy sources: Renewable energy is energy from sources that are naturally
replenishing but flow-limited; renewable resources are virtually inexhaustible in duration
but limited in the amount of energy that is available per unit of time.
The major types of renewable energy sources are:
Biomass
o Wood and wood waste
o Municipal solid waste
o Landfill gas and biogas
o Biofuels
Hydropower
Geothermal
Wind
Solar
Nonrenewable energy sources: When these sources are used up, they cannot be replaced,
which is a major problem for humanity as we are currently dependent on them to supply
most of our energy needs
Renewable and nonrenewable energy sources can be used as primary energy sources to produce
useful energy such as heat, or they can used to produce secondary energy sources such as
electricity and hydrogen.
2. Bối cảnh green growth ở VN (Quân)
2.1. Green growth ở VN đang phát triển ở mức độ thế nào? ( bối cảnh) (Vinh)
DESCRIBE
Context
According to Institute of Energy of Vietnam (IEV), Vietnam is set to face a surge in power
demand and consumption over the coming decade, which will have an impact on its energy
security. The Government of Vietnam expects power consumption to grow 10-12 percent
annually through 2030, one of the fastest power consumption growth rates in Asia.
In the capacity structure of the national power source in 2020, coal-fired power accounts for
about 33 percent, hydroelectricity accounts for 29 percent, gas turbines and oil-fired thermal
power accounts for 14 percent, and solar power (including rooftop solar power) accounts for 23
percent, and others about 1 percent (wind power, biomass power, import of hydroelectricity
from Laos). Maximum load capacity of the power system in 2020 is about 38.7 GW, The crude
reserve ratio of the power system (excluding wind and solar power) is 34.3 percent.
Coal thermal power: Vietnam is seeking to reduce coal-fired thermal power from 34
percent of its power source in 2020 to 27 percent in 2030. Despite increasing pressures
on its environmental impact, coal will remain the most practical option in the near term
to stimulate affordable electricity generation growth at the pace and scale needed by the
country. However, during this period, there will be no additional development of new
coal-fired thermal power. The Draft PDP8 suggested that only on-going coal-fired
thermal projects currently under construction and under investment promoted for
operation during the 2021-2025 period is included in the PDP8.
In the PDP8, the MOIT proposds to continue building a 500kV power transmission system to
transmit electricity from major power source centers in the Central Highlands, South Central
Coast, and North Central region to major load centers of Vietnam. Ho Chi Minh City and Red
River Delta to strengthen the interconnected transmission grid to support the North-Central-
South power transmission.
Accordingly, in the period between 2021 – 2030, the country will need to need to build a total
of about 86 GVA capacity of 500kV station and nearly 13,000 km of DMZ. With this grid
development program, Vietnam’s power grid initially meets N-1 criterion for power supply for
loads and N-2 criterion for particularly important loads.
Vietnam has a favorable geographical location and convenient LNG transportation route
including many deep-water ports and existing gas infrastructure systems that can be used.
Developing the LNG sector is an inevitable trend for Vietnam to diversify fuel sources for
electricity generation and contributing to ensuring energy security for Vietnam.
The Vietnamese government highlighted the use of LNG as a source for power generation and
will look to create more favorable conditions for foreign investors to develop such projects
given depleting domestic gas resources and rising investor interests in LNG projects. By the
end of December 2020, there were about 26 GW of gas-fired power capacity projects in the
pre-FID phase in Vietnam.
2. Renewable Energy
The PDP8 prioritizes the development of solar and wind power sources in large scale.
The ratio of renewable energy (excluding hydropower) in the PDP8 has increased to almost 30
percent in 2030. The PDP8 expects that by 2030, onshore and near-shore wind power will
develop an additional capacity of 9 GW, offshore wind power will develop an additional
capacity of 2-3GW, solar power will develop an additional capacity of 7GW, biomass power
will be reduced by 0.5 GW, and small-scaled hydropower will be reduced by 1.8 GW.
2.1) Offshore WindPower (at an area with a seabed depth of over 20m):
The Vietnamese government has also proposed several policies in recent months to boost the
development of the wind energy sector. The current FiTs for offshore wind is highly attractive
at 9.8 US cent/kWh which were increased from the previous rate. Because of difficulties
caused by he COVID-19 pandemic the FiT was extended from the original COD deadline in
November 2021 to the end of 2023.
In the PDP8, Binh Thuan, Bac Lieu and Ca Mau were highlighted as prioritized provinces for
offshore wind development. Up to December 2020, many investors registered to research and
invest in the South Central region with the total scale up to about 36 GW. Along Vietnam’s
coastline, high wind areas with good economic potential are only located in the South Central
region with total potential is about 80GW.
The total technical potential of solar power is very large at up to 1646GW. The total scale
potential for development of large-scale solar power nationwide is about 386GW, mainly
concentrated in the South, the South Central region, and the Central Highlands.
The theoretical potential of biomass energy in Vietnam from the combustion of rice husk, rice
straw, corn cob, cassava stalk, bagasse, and sugar cane waste is estimated at more than 2,500
MW.
For renewable power sources, the government has launched the Direct Power Purchase
Agreement (DPPA) pilot program, where renewable energy producers can sell and deliver
electricity directly to corporate customers. The size of the DPPA program is expected to range
from 400 to 1,000MW, and will be implemented nationwide from 2020 to 2022.
Opportunities
Opportunities are promising in offshore exploration and production technologies, equipment
and services; engineering steel fabrication; LNG supplies, LNG infrastructure; and
petrochemical technologies and equipment.
USTDA has funded nearly 80 activities valued at USD 20 million in Vietnam over the last 20
years. Vietnam represents the agency’s largest country portfolio in Southeast Asia. Through
feasibility studies, technical assistance and pilot projects, the USTDA Project Development
Program helps oversee project sponsors, identify technological solutions, and various sources
of financing for priority infrastructure projects
Vietnam is one of the Southeast Asian countries with rapid GDP growth, from 6.5-7% annually,
leading to an average increase in energy demand of 11% per year. So, we will discuss some
factors that influence the increase in energy demand both in the long term and in the short term.
Another factor can be technology, especially electric vehicles. According to the Vietnam
Registry, the number of electric vehicles (EV) registered in Vietnam was slightly more than
1,000 units by the end of 2020. Moreover, by July 2021, VinFast installed 500 EV charging
stations and plans to have 2,000 charging stations set up nationwide with over 40,000 charging
ports by the end of 2022. Therefore, Vietnam needs a lot of energy such as renewable energy
(wind and solar power) to meet the demands of the electric cars industry.
This strong growth may be, in part, due to low energy prices and substitution of primary fuels
for other inputs such as labor and capital. Both primary energy and electricity power for
industrial and civil sectors in Vietnam are relatively cheaper than are those in other countries in
the region (Australian Energy Council 2019)—the legacy of the exploitation of hydropower,
which has very low operating costs, as the main energy source and large implicit subsidies of
fossil fuel extraction and consumption. In recent years, the coal price has increased by 40%,
forcing customers to shift from fossil fuel to using more electricity (United Nations Development
Programme 2019).
PROPOSALS
Facing those issues, Vietnam also offers solutions to contribute to sustainable energy supply: In
2015, the government announced the first-ever national development strategy for renewable
energy, aiming for renewables to account for around 32% of total primary supply and
electricity generation by 2030. Now the real problem is how can we do that.
1. Hydropower
Vietnam's energy system still relies heavily on coal and hydroelectricity, therefore, pumped
storage hydropower can be considered the next future for Vietnam's energy transition. With the
completion of the Long Biên power plant in 2017, Vietnam is well positioned to meet its
ambitious target of producing 7,000MW of electricity from renewable energy sources by inc (in
fact, we did). This mega project is expected to reduce the country's reliance on fossil fuels and
reduce carbon emissions. In fact, a report by the World Wildlife Fund found that thanks to this
and other ongoing hydropower projects, Vietnam's current generation mix is already more
carbon-efficient than its neighbors.
Furthermore, pumped storage hydropower enables the balancing of supply and demand without
transmission losses in case of peak load demand by storing the water at lower levels during off-
peak hours.
However, in order to take full advantage of its hydro potential, Vietnam must increase
investment in grid infrastructure and develop markets for excess electricity. This will go a long
way toward achieving the government's goal to produce 30 percent of its energy from
renewable sources by 2030.
2. Wind Power and Solar Power
In fact, Vietnam are developing renewable energy projects from wind and solar, but the
shortage of electricity in the Northern during the summer months still occurs, and on other
hand, fast increasing the amount of wind and solar power can lead to a renewable energy
imbalance.
The solution to this problem is to develop a power transmission system to not only distribute
electricity to the areas in need but also to avoid the situation of "oversupply" when developing
the power network.
In detail, the development of wind power and solar power is mostly done in the Central and
Southern regions - where the natural conditions are more favorable, and since the greater power
consumption is from the North, therefore, with a developed power transmission system, we can
move excess energy from the Central to the North.
3. Biomass
Biomass is another source of renewable energy in Vietnam. The country currently produces an
estimated 8 million tonnes of biomass each year, mostly from rice straw and sugarcane.
As Vietnam's agricultural sector grows, the demand for biofuel will increase.
Biofuels such as ethanol can be blended with gasoline to power vehicles or burned to generate
electricity using conventional combustion methods.
This approach can ease the burden on traditional fuels and help to reduce emissions. The
government has also encouraged the use of biogas as an alternative energy source for domestic
use.
However, as with other renewable energy sources, sustainable production of biomass is limited
by the government's ability to access sufficient land and resources. A carbon tax should also be
imposed to promote the consumption of clean energy sources and encourage the development
of a cleaner economy.
Chỉ báo green growth(world bank) (cái này chưa biết đc nên xử lý như nào)
2.2.2. Quay trở lại VN, VN có những đặc tính gì phù hợp với green growth k (nếu có->
là lí do để phát triển green growth vì thuận tiện); Nếu phát triển green growth, chúng ta sẽ
được gì? VN có yêu cầu gì để cần phải phát triển green growth ngay lập tức ko? (ưu tiên
số liệu, graph nhiều)
Why VietNam is ready now?
As the trade-off between business efficiency and “going green” is
diminishing, Việt Nam’s economy and enterprises are accelerating towards green
and sustainable growth in line with mainstream global trends.
The world is witnessing mega-trends in geo-politics, globalization and
liberalization, climate change and innovation, with different scenarios.
Development issues in recent years are perceived as not completely new but
deeper with qualitative changes, including shifts from economic growth to
sustainable and inclusive development, from “brown economy” to “green
economy”, from “linear economy” to “circular economy” and from “real
economy” to “digital economy”.
From the 1900s, Việt Nam implemented strategies and policies on poverty
reduction, human development and sustainable development. In 2004, it issued
the Strategic Orientation on Sustainable Development (Việt Nam's Agenda
21). Since then, various strategies, plans and regulations were issued and updated
with a view to balance the economic interest and the negative externality on the
environment.
In 2020, it passed the Law on Environmental Protection in which for the first
time, the definition of circular economy (CE) is stated and various policies and
regulations on CE have been issued or drafted since 2021. And in early June this
year, Deputy Prime Minister Lê Minh Khái signed Decision No. 687/QĐ-TTg
approving a scheme developing the circular economy which is expected to
contribute to cementing the goal of reducing greenhouse gas emissions intensity
within GDP by at least 15 per cent by 2030 compared to 2014, towards the goal of
net zero emissions by 2050.
In agriculture, farmers are shifting from traditional farming model VAC (garden-
pond-barn) to new models to reduce the adverse impact on the environment and
make use of raw materials more efficiently such as VAC+biogas, VAC+forest
and VAC+raising shrimp or planting rice.
In industrial production, both authorities and provinces have pledged to promote
eco-friendly industrial parks (IPs), especially the Nam Cầu Kiền eco-IP in Hải
Phòng City built in 2008 according to Japanese standards, which is a private
initiative in which production communities have a symbiotic relationship with
efficiency in environmental and natural resources management.
Businesses are also investing more heavily in green business models such as
“green circle” in dairy farms of Vinamilk or TH Milk. More and more businesses
are also developing according to the criteria of the Corporate Sustainable
Development Index (CSI) launched by the Vietnam Chamber of Commerce and
Industry (VCCI) and the Vietnam Business Council for Sustainable Development
(VBCSD) since 2016.
From the capital side, many financial institutions are taking bold steps to finance
and facilitate green and eco-friendly loan packages as an essential part of their
sustainable investment and net-zero pledges.
According to the State Bank of Việt Nam (SBV), more than 31 financial
institutions are involved in green credit, with total credit of VNĐ290 trillion
(US$12.5 billion) in 2020, mainly in fields of green agriculture and renewable
energy.
-> Therefore, In a world with many uncertainties and risks, enterprises need to
learn how to manage risks and shocks from geopolitical tensions, supply of input
materials, financial-monetary instability and natural disasters.
SOLUTION
1. Build and refine institutions and policies
Promote the application of green economic tools with regards to production and
consumption activities; regarding the system of standards and national criteria for
green classification, consistency and transparency must be ensured, they must be
regularly updated for different programs, projects, services, technologies and
industries.
Raise the effectiveness and the efficiency of state management in the monitoring
and evaluation of the Strategy’s implementation and the economy’s level of
greening.
2. Communicate, educate and raise awareness
Continue to propagate, educate and raise the awareness of the whole society about
the role and significance of green growth.
Attach importance to education on soft skills, strengthen coordination between
schools, families and society so that a green-oriented consciousness and a green,
civil, contributive and innovative lifestyle could take shape.
Raise the energy labels, ecology labels and green labels identification abilities
with regards to goods and products; further popularize information on low-
emissions and environmentally friendly products and services.
3. Develop green human resources and employment
Attach importance to organizing training activities and fostering
management/operational knowledge in the green economy and the green
manufacturing industries for public administration cadres and businesses, with
special attention paid to cadres in leadership/management positions and cadres
who perform the policy planning work
Prioritize investments into the infrastructure of schools and vocational training
facilities in accordance with green standards and criteria in order to serve the
tasks of training and teaching.
4. Science, technology and innovation
Encourage the tasks of researching and developing models to apply science,
technology and innovations to serve the purpose of achieving green growth.
Step up the comprehensive digital transformation in different industries and
fields, with an orientation towards the goal of Viet Nam becoming a digital
country.
5. International integration and cooperation
Strengthen and raise the quality of international economic integration; cooperate
and bring into play international support in order to turn VietNam into one of the
role models with regards to green growth; effectively fulfill international
commitments related to sustainable development and climate change.
Proactively cooperate in research, education and training, thereby creating
favorable conditions for enterprises and research institutions in terms of access to
advanced technologies; carry out technological transfer and develop human
resources for green economic sectors.
Actively organize and participate in activities to share/study experiences related to
green growth and raise the capabilities to achieve green growth; proactively
coordinate and join hands with the international community to tackle global and
regional issues, as well as challenges in the process of achieving green growth.
Ensure that different social groups, especially subjects affected during the process of
restructuring the economy in conjunction with renewing the growth model and vulnerable groups
(women, children, ethnic minorities, the poor, people with disabilities) have equal access to
opportunities, information, technical infrastructure and basic social services, in a manner that
suits the new fields and jobs in the process of transforming into a green economy.
Group Presentation 6.
Present some examples of “No waste” cities around the world. What is
circular economy? Present the current situation and potential of
implementing circular economy in Vietnam.
1. What is no waste :
No waste / zero waste is a conservation of all resources by means of responsible
production, consumption, reuse and recovery of product packaging and materials without
burning and with no discharges to land, water or air that threaten the environment or
human health.
business models, goods and packaging in order to reduce resource-use and waste
2
Reduce and reuse
Minimise the quantity, toxicity and ecological footprint and any operation by which products or
components that are not waste are used again for the same purpose for which they were
conceived
3
Preparation for reuse
Checking, cleaning or repairing operations, by which products or components of products that
have become waste are prepared so that they can be re-used without any other pre-processing
4
Recycling/composting/anaerobic digestion
High quality material recovery from separately collected waste streams
5
Material and chemical recovery
Technologies to recover materials from mixed waste into new valuable materials in an
6
Residuals management
What cannot be recovered from mixed waste is biologically stabilised prior to landfilling
7
Unacceptable
Options that don’t allow for material recovery, have high environmental impact and create lock
in effects that threaten the transition to Zero Waste: waste to energy incineration, co-incineration,
plastic to fuel, landfilling of non-stabilised waste, gasification, pyrolysis, illegal dumping, open
The Zero Waste Cities approach is a continuous effort to phase out waste – not by burning or
landfilling it – but instead by creating and implementing systems that do not generate waste in
the first place
Example
San Francisco
The pioneer among zero waste cities in America, San Francisco has spent 19 years
incrementally moving toward becoming a 100% trash-free zone. The city has made great strides
toward its goal, successfully diverting 80% of its waste away from the landfill in 2012.
Kamikatsu, Japan
Source: nippon.com
Perhaps one of the most well-known zero-waste communities outside of the United States, the
village of Kamikatsu made a zero-waste declaration back in 2003 and never looked back.
Behind the US, Japan is the second-largest producer of plastic in the world and incinerates 78%
of solid waste (including some recyclables). However, this remote village has managed to buck
the trend and recycle, compost, or reuse more than 80% of its waste through a truly
comprehensive zero-waste program.
Taiwan
Source: ketagalanmedia.com
The Taiwanese waste plan has achieved what sounds miraculous for an entire country—a 99%
landfill diversion rate. Digging a little deeper, the reality is that around 40% of that waste is
currently incinerated.
Solution
=> Conclusion: The country is now faced with the increase of many types of waste, especially
domestic waste while there is a lack of effective waste management. Therefore, even though
Vietnam has not had any specific term for the circular economy, it is necessary to circle the
natural resources has been emphasized in many momentous legislation documents and in many
actual recycling models. In fact, the volume of recycled materials in Vietnam is still small
compared to the input of the economy, and still far from its target of reducing waste.
Consequently, in the near future, Vietnam prioritizes the 3R policy to build a proper
infrastructure before applying the circular economy concept for the sustainable development of
the country.
The circular economy development scheme is approved in Vietnam, which brings a lot of
benefits to the country.
- Missions
create specific plans for the circular economy and apply in cities and provinces around
the country
boost cooperation with international partners and donors through specific projects,
technology, and services → figure out opportunities to increase access to knowledge,
expertise, and resources for circular economy development.
strengthen public-private dialogues → promote social responsibility
complete legal frameworks and policies for the circular economy with the required
human resources.
=> Conclusion: The country is now faced with the increase of many types of waste,
especially domestic waste while there is a lack of effective waste management.
Therefore, even though Vietnam has not had any specific term for the circular economy,
it is necessary to circle the natural resources has been emphasized in many momentous
legislation documents and in many actual recycling models.
In fact, the volume of recycled materials in Vietnam is still small compared to the input
of the economy, and still far from its target of reducing waste.
Consequently, in the near future, Vietnam prioritizes the 3R policy to build a proper
infrastructure before applying the circular economy concept for the sustainable development of
the country.
Vietnam is shifting from a linear economy toward a circular economy, targeting sustainable
economic development for a more competitive economy. To realize that goal, the government
recently issued Decision 687 on circular economy development which was followed earlier by
the revised Law on Environmental Protection (LEP). Vietnam Briefing highlights key updates
while looking at what these changes would mean for businesses and investors.
A number of Strategies and Action Plans of a number of sectors and fields have concretized the
orientation of transition to the TH economy as the orientation of Vietnam's National Energy
Development Strategy; National strategy on livestock, National strategy on green growth 2011-
2030.
2.2. In the law of Vietnam
The Law on Environmental Protection 2020 with many new regulations, in line with
international experience, is expected to change the behavior of actors in society
Vietnam is also one of the first countries in ASEAN to include the regulation of the eco-
economy in the Law on Environmental Protection 2020.
In addition, compare policies in strategic directions and legal regulations on promoting the
application of the market economy of Vietnam with other countries in the world . Looking at the
table on the screen ,it shows that Vietnam has built a fairly adequate legal and policy foundation
to promote the transition process. change to a knowledge-based economy according to different
sectors, fields and regions of the economy
AGRICULTURE:
- Model of collecting compost to water crops and vegetables in the suburbs of Hanoi (typically
Co Nhue village, Tu Liem district, Hanoi in the past, in the 50s-70s of the twentieth century
when there was no toilet for use).
- The model of garden - pond - barn (VAC), garden - forest - pond - barn (VRAC) from the 70s-
80s of the twentieth century, the ecological economic model from the 90s-2000s.
- Currently, the farming model of farm households that recover manure and biogas brings
economic benefits to increase income along with selling output products, typical of some
households in Moc Chau cow raising model.
INDUSTRY:
- The appearance of traditional craft villages in Vietnam using scraps, by-products and wastes
from industrial production: Producing recycled steel - Da Hoi (Bac Ninh), producing recycled
paper Duong O (Bac Ninh), manufacturing plastic products, recycled nylon Minh Khai (Hung
Yen), recycled glass... appeared early and still exist and develop.
-Cleaner production has been implemented in enterprises and brings certain effects to enterprises
with old technology that wastes resources, energy and discharges directly into the environment..
- The recent birth of an eco-industrial park in Hai Phong, Ninh Binh and some other localities
from the direction of the Government has been evaluated by UNIDO as a model close to the
circular economy that brings typical economic efficiency in Vietnam in industrial production.
- Some enterprises have shown signs of reuse and recycling of waste such as the former Thang
Long Pharmaceutical Company (selling pre-processed tobacco leaves to Vinh Phuc flower
farmers as fertilizer, reselling the discarded part). cardboard packaging for paper recycling), …
and many companies other than not to waste waste can be reused, recycling brings economic
efficiency.
In general, there are some approaches to the circular economy in VN but we only step to stage
of recycling the waste to make it the input of other economic activities.
Potential
We have already started the journey towards a more circular economy. One can quantify the
circularity of the Vietnam economy from 3 angles:
Renewable resources
The first way of quantifying the circularity of the Vietnam economy as it now stands is to
analyse the extent to which renewable resources are being installed, and to establish how
resources are consumed in the VietNam and the extent to which feedback loops such as recycling
are featured in the system. Insight can also be gained from innovation indicators.The Vietnam
does score well in the field of renewable energy (figure 9).
Opportunities:
-Firstly, this is a common global trend that has been successfully proven in many countries
around the world such as Sweden, Denmark, Finland, Canada, Japan, China, Singapore...
Therefore, Vietnam will learn a lot from the experiences of previous countries and be in line with
the general trend of the world.
- Secondly, we are in the process of perfecting the socialist-oriented market economy institution,
the model transformation from "linear economy" to "circular economy" is designed from the
Party's policy to develop the economy. Fast and sustainable economy is a great opportunity.
Notably, recently, the revised Law on Environmental Protection 2020 was approved by the XIV
National Assembly at its 10th session on November 17, 2020, and the content of developing the
economic model has been stipulated in the law.
-Third, encouraging and creating a mechanism for the private economy to develop in the context
of a competitive market will have many opportunities for private investment in the
implementation of the development of the knowledge economy in the coming time.
-Fourthly, we have been moving towards the 4.0 revolution, implementing the development of a
knowledge-based economy associated with high technology, moving from the real world to the
digital world will be a great opportunity to improve development efficiency compared to the
traditional development method.
-Fifth, the pressure of shortage of resources, environmental pollution, large amount of waste,
especially plastic waste and plastic bags, are paid great attention by the Party and State. In
addition, we are implementing the SDGs and responding to climate change, the circular economy
development is the way of development to help realize many of the goals and targets required by
the SDGs, the development of the circular economy will be an advantage for reduce greenhouse
gas substances, because they are recovered almost completely, do not emit into the environment.
-Sixth, the development of a circular economy will receive high consensus and support from
society, because this way of development will solve resource scarcity, protect the environment,
respond to climate change and bring high economic efficiency.
CHALLENGES:
At the government level, the OECD (2019) identified 13 major barriers for countries to transition
to a knowledge-based economy (Figure 3). In which, cultural, regulatory, financial and vision
barriers are the outstanding issues to make the transition to a knowledge-based economy that
governments face, including culture, institutions, and financial resources. key, comprehensive
vision, well-informed, regulatory uncertainty, financial risk, perception, scale, human resources,
private sector involvement, political readiness and technology solutions [12]
-Firstly, the correct awareness of the nature of the circular economy is carried out from design to
practical implementation, in industries and fields, for each enterprise, people and all levels of
management and leadership to Creating a common consensus is a big challenge.
-Second, the circular economy is associated with technological innovation and model design in
the context that we are a developing country, most of the technology is outdated, and the
production scale is small, which is a big challenge that needs to be overcome.
-Third, we do not have an adequate legal corridor for circular economy development, in fact, it
has just been included in the Law on Environmental Protection 2020, which needs guidance from
the Government, this challenge needs to be overcome, otherwise the implementation .At present,
circular economy development is only spontaneous and subject to market dynamics, enterprises
will face many difficulties when implementing the circular economy model.
-Fourth, we do not have a set of criteria to identify, evaluate, summarize and give an accurate
classification of the development level of the circular economy, which is a big challenge to know
the current economic development.
-Fifth, the circular economy is the culmination of the zero-emissions approach, which requires a
truly shared coordination with economic benefits, so the use of economic incentives, market to
connect stakeholders to implement a circular economy is a big challenge.
-Sixth, to implement a circular economy, the last stage is to reuse and recycle waste after
production and consumption. Currently, these experts have not been trained and have no
specialized training in circular economy.
-Seventh, the circular economy requires the classification and cleaning of waste before being
reused or recycled, which is a big challenge for the practical operation of the Vietnamese
economy and the awareness of segregation of waste at the source of the people. The consensus of
each citizen on waste segregation at source in Vietnam is a big challenge.
Một là, khung chính sách về phát triển mô hình kinh tế tuần hoàn chưa được hoàn thiện. Hiện
nay, Việt Nam còn thiếu các cơ chế chính sách thúc đẩy kinh tế tuần hoàn phát triển như: Quy
định trách nhiệm của DN về thu hồi, phục hồi tài nguyên từ các sản phẩm đã qua sử dụng; các
công cụ, chính sách kinh tế như thuế tài nguyên, phí bảo vệ môi trường…
Hai là, nhận thức về kinh tế tuần hoàn và sự cần thiết chuyển đổi sang phát triển mô hình kinh tế
tuần hoàn còn hạn chế. Nhận thức đúng về kinh tế tuần hoàn cần được thực hiện từ việc thiết kế
tới triển khai đối với từng ngành, từng lĩnh vực và cần được đồng thuận, thống nhất từ lãnh đạo,
các cấp quản lý tới từng DN và người dân.
Ba là, nguồn lực cho việc thực hiện chuyển đối sang phát triển kinh tế tuần hoàn còn yếu. Kinh
tế tuần hoàn phải gắn với đổi mới khoa học, tiếp cận công nghệ tiên tiến. Bên cạnh đó, để phát
triển kinh tế tuần hoàn đòi hỏi phải có đội ngũ chuyên gia giỏi, để giải quyết tốt các vấn đề, từ
khâu đầu đến khâu cuối của cả quá trình.
Bốn là, Việt Nam còn thiếu các DN đủ năng lực về công nghệ về tái chế, tái sử dụng các sản
phẩm đã qua sử dụng; khó thay đổi ngay thói quen sản xuất và tiêu dùng của toàn xã hội hiện
nay đối với nhiều sản phẩm dễ sử dụng như túi nilon, sản phẩm nhựa dùng một lần sang chỉ sử
dụng những vật liệu, sản phẩm có thể tái chế, tái sử dụng hoàn toàn; các DN Việt Nam có quy
mô vừa và nhỏ khó khăn trong việc đầu tư đổi mới công nghệ.
Solution
The scheme's firm measures are set to increase community awareness about the circular
economy and promote its development among businesses and residents.
The building of specific circular economy plans and integrating them into strategies in cities and
provinces around the country is essential.
The other task is to boost cooperation with international partners and donors to seek
opportunities to increase access to knowledge, expertise, and resources for circular economy
development through specific projects, technology, and services.
The country will also intensify public-private dialogues about the circular economy to promote
corporate social responsibility and help businesses solve their problems in this area.
Legal frameworks and policies to facilitate development will be completed for prioritised sectors
so as to implement a pilot programme with the required human resources.
=> Conclusion:
The circular economy is and will continue to be an awkward term. It is not a new model. It
mainly concerns structuring the economy in a sustainable way with the priority being to use
materials efficiently and reduce and ultimately eliminate waste flows. The materials cycle is the
central issue.
Along with the development, the country is now faced with the increase of waste in many types,
especially the domestic waste, while the infrastructure for waste management is still inadequate.
Vietnam has not any specific term on circular economy; nevertheless, the necessary of circle the
natural resources has been emphasized in many momentous legislation documents and also
found in many actual sub-models for recycle and reuse of waste. In fact, the volume of recycled
materials in Vietnam is still small comparing to the input of the economy, and still far from its
target on reducing the landfill rate of collected waste. Because of that, in the near future,
Vietnam is still focused on 3R policy to build a proper infras- tructure before applying the
circular economy concept and frame for the sustainable development of the country.
Group Presentation 7.
Present overview of labor force status in Vietnam? Giving some trends of
labor force geography of Vietnam in the economic integration process and
policy implication?
Group Presentation 8.
What is the role of Foreign Direct Investment (FDI) for Vietnamese economy?
Status of FDI in Vietnam? What is the downside of FDI? What are solutions
for FDI management?
FDI overview
Foreign direct investment (FDI) is an ownership stake in a foreign company or project
made by an investor, company, or government from another country. In general, FDI plays the
role as the key factor of international economic integration because it connects the economies
with stable and durable bonds. FDI often takes the form of capital, technologies, equipment,... It
is important to note that FDI creates great influence on the foreign business decisions, and may
even take full control of the receiver.
FDI is sorted into 3 different types: horizontal, vertical and conglomerate. In the
horizontal type, films invest in another country to establish the same business as the one they
currently operate. The vertical type, the films open a complementary business in other countries.
And the last type, conglomerate, the films invest in businesses that are totally unrelated to their
current operation, this type often takes the form of joint venture, since the investors do not
possess enough experience in the field.
There is a concept that shares some similarities with FDI, that is FPI. FPI stands for
Foreign Portfolio Investment, is financial asset held by foreign investors. FPI often takes the
form of stocks and bonds of the recipient companies. Compared to FPI, FDI is a larger
commitment, and thus the investors acquire the outright acquisition of the recipient.
FDI creates the relationship in which both the investor and recipient gain benefits, it
helps the economic development in both the investing countries and receiving countries.
Developing countries, Vietnam for example, receive FDI to finance the construction of their
infrastructure and decrease the unemployment rate by creating more jobs for local workers. On
the other hand, FDI investors gain benefit from expanding their business in the international
market. However, as the FDI resources flow under policies and laws of different nations, that
may lead to some political conflicts.
Downside of FDI
Hindrance of domestic investment
Sometimes FDI can hinder domestic investment. Because of FDI, the cost of investments
becomes more expensive, meaning that 1 dollar invested in return for fewer shares in a company.
Even foreign investors compete for or take away potential opportunities of domestic investors
and push domestic capital out to other countries. This phenomenon is called the “overwhelming
effect”. This effect is formed when foreign capital flows instead of supporting and contributing
capital to the economy, it competes and pushes other capital flows out.
Affect to exchange rates
FDI can affect exchange rates. To be specific, FDI directly affects the trade balance
through foreign-invested import and export companies, and by adjusting the total amount of
goods exported or imported, investors can influence the exchange rate of that country. There is
an example case: smartphones and electronic components are the products that account for the
largest proportion of Vietnam's export structure, about 51 billion USD. In the structure of
exporting components and phones, Samsung accounted for 97.75% total export turnover. So in
the scenario where Samsung suddenly changes the output, it will have a significant impact on
Vietnam's trade balance and thereby indirectly affect the exchange rate. After that, the
Government must use foreign currency reserves to buy back VND to stabilize the exchange rate.
Potential Risks
FDI can cause some potential risks of economic bubbles and inflation. First, when
foreign capital flows are not efficient, it will become a burden on the financial system, because it
pushes the asset's price over its actual value. In that case, an economic bubble is formed. Second,
the government wants to attract FDI, they have to loosen fiscal policies and regulations and that
will make the country more dependent on FDI. That means then, foreign capital will be the main
driving force to boost the economy; import and export will play the most important role in GDP
structure. This can bring some benefit: diversifying the commodity market since people have a
higher chance of satisfying their needs when there are many choices of goods and services;
creating opportunities to exchange and learn the knowledge and technology of other countries,
shortening the development gap; products and services are not confined to the country but are
expanded to international markets, this helps increase revenue for domestic enterprises. On the
other hand, as FDI becomes the driving force, some drawbacks will emerge: the country's
economic and financial autonomy is weakened, since foreign enterprises can acquire important
companies and industries of the country and thereby greatly influence political decisions; the
defense against global economic shocks is reduced, because the more countries depends on FDI,
the more severely affected the global recession will be.
Exploitation
Foreign investors can exploit a country in two ways. First is exploitation of labor. Foreign
investors are exploiting workers in poor countries . The most common is that these businesses
regularly employ people who are unemployed for seasonal work, and because they are not
engaged for a labor contract, they are not protected by labor laws and have to work overtime in a
dangerous environment. The other is exploitation of resources and the environment. Foreign
investors often target underdeveloped or developing countries that have abundant resources to
invest because the input costs of non-renewable minerals there are often cheap and already
available to use. Additionally, the regulations and taxes on environmental protection here are still
lax, foreign companies can take advantage of this to maximize their profits, and the receiving
country will suffer environmental damage.
Group Presentation 9.
What are sharing economy’s impacts to the global economy? How does
Vietnamese economy benefit from sharing economy and what should be done
for promoting these benefits for Vietnam?