"Green" enterprises are still out of the picture
Speaking at the Workshop "Unblocking green credit flows" on April 25, Mr. Le Quang Thang - Chairman of the Board of Directors of Viet Long Company - said that the enterprise has oriented to develop a circular economy from the beginning, focusing on treating 400-500 tons of waste per day using landfill-free incineration technology and investing in a clean agricultural production chain linking three houses.
Despite implementing many green models, Mr. Thang said that access to green credit for businesses is still "nearly distant" due to lack of specific industry criteria, lack of suitable mortgaged assets and large investment characteristics, slow capital recovery. After more than 10 years of proactively contacting many banks, Viet Long has not yet received any loans from the green credit portfolio.
Dr. Bui Thanh Minh - Deputy Professional Director, Office of the Private Economic Development Research Board (Board IV) - emphasized that green credit is not only capital, but a long-term way of thinking.
Green credit is not a cheap source of capital, but an old capital flow - long-term capital for long-term goals - Mr. Minh said.
The survey results of Board IV show that the biggest barrier that businesses face in the green transformation process is the lack of investment capital, accounting for 50% of the response. Next is the lack of appropriate technical personnel (46%) and the lack of green technology solutions (42%).
Many small and medium-sized enterprises still have difficulty accessing information, technical records and requirements from banks, making it difficult for them to meet the criteria for accessing green credit. Weak internal resources while under pressure for transformation have caused private enterprises to fall into a double situation of difficulties.
Mr. Minh also affirmed that the banking industry is the most ready party for green credit. Commercial banks have now designed specialized programs and issued internal risk regulations, not only providing green credit packages but also being the best ESG enforcement force in the financial system.
Green credit will be a driving force, a catalyst to help the private economy develop
From the perspective of an international expert, Dr. Nguyen Ba Hung - chief economist of the Asian Development Bank (ADB) in Vietnam - said that green finance is an inevitable development trend, no longer an option but a mandatory requirement. Vietnam is witnessing a rapid increase in greenhouse gas/GDP emissions - an inevitable consequence of the industrialization process that relies heavily on fossil energy. Previously, Vietnam had the lowest emissions per unit of energy consumption in the region, but has now risen to the top in terms of growth rate. This is no longer a potential challenge but an urgent reality.
Dr. Hung pointed out that the difference between green finance and regular finance lies in the fact that credit institutions not only consider the financial capacity of enterprises, but also have to assess whether the purpose of using the loan meets the "green" standards or not. This requires a complete system of criteria, along with professional appraisal capacity from the bank. He also recommended diversifying green financial products, developing credit, bonds, climate risk insurance, carbon credits, emission trading floors, etc. to create a truly complete and sustainable green financial ecosystem.
Also proposing solutions, Dr. Minh - Representative of Board IV said that the first thing is to complete the legal framework, especially to soon issue a list of green projects eligible for credit priority.
The Government and the State Bank need to regulate assessment standards, require banks to periodically announce green credit balance and emission reduction impacts from lending portfolios. At the same time, there should be a mechanism for preferential refinancing, reducing capital costs for credit institutions, establishing green credit guarantee funds or expanding the scope of the Environmental Protection Fund. It is necessary to design additional tax incentives such as reducing import tax on green equipment or corporate income tax for units that actively implement ESG.
Banks need to improve their professional capacity in green finance, build specialized units, and have environmentally effective metering tools such as CO2 emission reduction. International cooperation is also very necessary, to learn from experience from countries like China, mobilize resources from international financial institutions such as the WB, ADB, and the Green Climate Fund. At the same time, it is necessary to promote the diversification of green financial instruments, encourage businesses to issue green bonds, build carbon credit trading floors, and implement climate risk insurance.
Finally, for private enterprises to truly participate in the game, there needs to be a mechanism for consulting, supporting the preparation of records, accessing information, enhancing communication and training on green transformation.
Dr. Minh shared that green credit capital is not only a financial tool, but will become an important driving force and catalyst to help the private economic sector transform the development model towards green, sustainable and more effective.
