SUSTAINABLE FINANCE IN VIETNAM: CURRENT SITUATION AND DEVELOPMENT ORIENTATION

Abstract

Sustainable finance has become an essential trend globally, especially in the context of climate change and national commitments to achieving net-zero emissions. In Vietnam, the government has pledged to reach net-zero carbon emissions by 2050, creating an urgent demand for green financial resources. This study adopts a qualitative methodology combined with a theoretical literature review to examine the current state of sustainable finance in Vietnam. Despite notable policy initiatives such as the National Green Growth Strategy and green credit promotion frameworks, the scale of sustainable finance remains modest - green credit only accounts for approximately 4.5% of total outstanding loans, and green bond issuance is limited to 19 issuances between 2018 and 2023. The study identifies several barriers hindering development, including the absence of a national green taxonomy, limited ESG awareness among SMEs, a lack of tailored green financial products, and underdeveloped supporting markets such as carbon trading and sustainability ratings. Based on this analysis, the paper proposes strategic recommendations for Vietnam, including improving regulatory frameworks, expanding ESG education, diversifying green financial instruments, and leveraging international partnerships to accelerate sustainable finance development aligned with national climate goals and the Sustainable Development Goals (SDGs).