There is no clear mechanism for businesses to issue green bonds.

At the conference on implementing the task of developing the stock market in 2024 on the morning of February 28, General Director of the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) Le Ngoc Lam informed that according to the World Bank's estimates, the capital demand for green development in Vietnam from 2022 to 2040 is up to 368 billion USD.

Globally, green bonds play an important role in the investment capital structure for sustainable growth. In countries that have succeeded in green transformation and growth in the European region, the proportion of green, social and sustainable (GSS) bond issuance accounts for 50-60% of the total green finance scale. This proportion in the Asian region has also reached about 30-35%.

In line with the general development trend of the world as well as the Government's orientation, BIDV has built a development strategy for the period 2021-2025, vision 2030, and set the goal of becoming a net zero bank by 2050.

BIDV General Director said that BIDV's total outstanding green credit to the market reached 71,000 billion VND, an increase of 11% compared to 2022. Of which, the clean energy and renewable energy sector has an outstanding debt of 57,000 billion VND, with 1,600 projects of 1,300 customers.

Finance - Banking - BIDV General Director: There is no clear mechanism for businesses to issue green bonds — BIDV Bank General Director Le Ngoc Lam spoke at the conference.

However, during the implementation process, BIDV General Director realized that there are currently no clear mechanisms and policies to create incentives for green bond issuers and investors.

From there, BIDV leaders proposed a number of recommendations to improve the legal frameworks related to green bonds, including: Regulations on classifying and certifying national green projects to apply incentive policies need to consider the similarities between Vietnam's green criteria and international standards.

"This makes it easier for businesses to implement projects and attract domestic and foreign investment according to the same set of standards," said Mr. Lam.

In addition, he also recommended considering regulations on green criteria including levels corresponding to different levels of policy incentives. Then, enterprises issuing green bonds can gradually access preferential policies as well as create goals/motivations to achieve sustainable growth.

At the same time, issue guidelines for green bond issuance and post-issuance reporting, taking into account specific regulations between the operations of credit institutions and economic organizations.

" Support and encourage businesses to make green transformation and issue green bonds through continued research and expansion of policies to support businesses issuing green bonds such as supporting issuance costs, tax incentives, promoting training and developing human resources on the environment, promoting propaganda and encouraging businesses to make green transformation", said BIDV General Director.

He also said that it is necessary to encourage investors to participate in green bond investment, such as considering issuing preferential policies large enough to encourage investors to buy bonds (for example, preferential credit limits, taxes on investment yields, etc.); raising awareness of investors' responsibility towards sustainable development, community and society .

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