Vietnam’s forest carbon credits draw global interest

Vietnam’s forest carbon credits draw global interest

International businesses and organisations are showing strong interest in sourcing carbon credits from Vietnam, including forestry-based credits. A new survey by Swiss carbon finance consultancy South Pole indicates growing confidence in the country’s potential to supply the international carbon market.

At a consultation workshop in Hanoi on December 4, South Pole reported that 73 per cent of 15 international organisations surveyed expressed 'healthy interest' in Vietnam’s carbon credits, although projects must meet buyer requirements and undergo further checks and due diligence before contracting.

“Buyers generally prefer transaction volumes of 100,000–500,000 tonnes and a price range of $5–15 per credit, although many choose not to disclose expectations. The most preferred standards are internationally recognised and familiar to the market,” said Roxanne Tan, senior managing consultant at South Pole Ltd.

“Market awareness of a carbon standard is reflected in factors such as benchmark pricing, credit ratings, transaction volumes, and issuance and retirement levels,” she said.

The survey indicates that buyers generally prefer projects that complete carbon certification and secure an Article 6 Letter of Authorisation, which allows the international use of carbon credits to meet emission targets, before finalising any purchase agreement. Buyers’ preferences reflect efforts to reduce regulatory and project-specific risks, prioritising compliance and project maturity. Ideally, sellers should also obtain authorisation, achieve successful credit issuance, and secure local stakeholder support. These requirements may be treated as conditions precedent before a contract becomes enforceable.

As an emerging carbon market, Vietnam has an opportunity to integrate buyer preferences into its carbon market and Article 6 frameworks. With policy and regulatory systems still under development, it will be crucial to engage both local and international market players, who can help highlight the potential of Vietnam’s forest carbon sector.

At the workshop, speakers provided updates on the implementation of the North Central Region Emission Reductions Payment Agreement (ERPA) and on the development of regulations and roadmaps for the domestic carbon market and international carbon trading. Participants also discussed initial assessments of transaction pathways for excess emission reductions from the ERPA scheme and future forest carbon projects, while identifying potential buyers for these credits.

Forest carbon credits are becoming a key financial tool for supporting forest protection, restoration, and sustainable management, while also boosting biodiversity and improving local livelihoods. Under ERPA, Vietnam generated 16.2 million tonnes of carbon dioxide equivalent (tCO₂e) of emission reductions in 2018–2019, independently verified by Aster Global Environmental Solutions. Of this, 10.3 million tCO₂e have been traded, and one million tCO₂e were recently authorised by the government for additional transfer under Resolution 261/NQ-CP dated August 2025, leaving about 4.9 million tCO₂e available for potential use.

Meanwhile, Vietnam is finalising the legal framework and infrastructure for its domestic carbon market, expected to operate fully by 2029. This includes draft decrees on the international transfer of greenhouse gas mitigation outcomes and carbon credits, on forest carbon sequestration and storage services, and draft national standards on forest carbon credits, aiming to create a synchronised legal corridor for trading under both domestic standards and Article 6 of the Paris Agreement.

VIR