Carbon exchange opens new asset class for capital market

Carbon exchange opens new asset class for capital market

While still in its early stages, the exchange is regarded by market participants as the foundation of a new component within Việt Nam's sustainable finance ecosystem.

The Cần Giờ mangrove forest is an important carbon absorption ecosystem, supporting the generation of carbon credits for Việt Nam's carbon market. — VNA/VNS Photo

The newly launched carbon exchange is expected to introduce a new asset class to Việt Nam's capital market, laying the groundwork for attracting capital to support the economy's green transition while integrating environmental objectives more closely with financial markets.

The domestic carbon exchange officially began operations on June 29, marking the first time Việt Nam has established a marketplace where carbon allowances and carbon credits can be traded under a transparent pricing mechanism.

While still in its early stages, the exchange is regarded by market participants as the foundation of a new component within Việt Nam's sustainable finance ecosystem.

Speaking at the launch ceremony, Vũ Thị Chân Phương, chairwoman of the State Securities Commission of Vietnam, said the carbon exchange would establish a transparent mechanism for trading emissions allowances and carbon credits, and also help form a market-based carbon pricing system.

"The official launch of the carbon exchange today is not only an important milestone in completing Việt Nam's institutional framework for green economic development, but also demonstrates the Government's commitment to building a transparent and efficient market that helps businesses adapt to the new requirements of international economic integration," Phương said at the time.

She added that market-based carbon pricing would create economic incentives for businesses to upgrade technology, improve energy efficiency, reduce emissions and enhance competitiveness.

Unlike equities, which represent ownership in a company, or bonds, which reflect lending relationships, carbon credits are created from verified greenhouse gas emissions reductions. 

Their value lies not in the certificates themselves, but in the market-recognised right to emit or the verified reduction in emissions that buyers are willing to pay for. 

By turning emissions reductions into tradable assets, environmental goals become market price signals, creating financial incentives for businesses to invest in greener technologies.

According to President of the BIDV Board of Directors Lê Ngọc Lâm, Việt Nam is not just opening another trading platform, but laying the foundation for an entirely new financial architecture that places climate considerations at the centre of the economy.

If emissions were previously viewed mainly as something to be controlled, emissions reductions can now be quantified into carbon credits that are priced and traded as assets. 

Once carbon credits have a market value and can be traded, emissions reduction targets become directly linked to the capital allocation process.

Lâm said carbon credits could become a new financial asset capable of being valued, traded and, in the future, potentially used as collateral, thus expanding the range of instruments available in Việt Nam's capital market.

International experience suggests carbon pricing is becoming an increasingly important financial tool for supporting the climate transition. 

According to the World Bank's State and Trends of Carbon Pricing 2026 report, 87 carbon pricing mechanisms are now operating worldwide, covering nearly 30 per cent of global greenhouse gas emissions and generating about US$107 billion in revenue in 2025.

Meanwhile, data from the International Carbon Action Partnership shows emissions trading systems worldwide generated around $79 billion in revenue in 2025, highlighting the growing role of carbon markets in mobilising capital for green investment.

Lâm noted that a transparent carbon market could also improve the country's attractiveness to international institutional investors, many of whom increasingly incorporate environmental, social and governance criteria into investment decisions.

He also said carbon markets in many countries had become a green passport for accessing international capital, while helping exporters respond to cross-border carbon regulations. The mechanism could also enable Vietnamese banks to secure lower-cost green financing from multilateral institutions.

Looking ahead, Lâm said he expected the carbon market to support the development of a broader financial ecosystem, including carbon finance, repurchase agreement financing backed by carbon credits, carbon credit tokenisation, carbon credit-backed lending and carbon advisory services.

As these services develop, carbon credits could evolve beyond exchange-traded instruments into financial assets that can support financing activities, adding a new dimension to Việt Nam's capital market while reinforcing the country's transition toward a greener economy. 

Bizhub