Viet Nam, Japan strengthen carbon credit partnership

This agenda topped the bilateral meeting between Deputy Minister of Agriculture and Environment Le Cong Thanh and Japan’s Deputy Minister of the Environment Doi Kentaro. The discussion took place while both delegations were attending the 30th Conference of the Parties to the UN Framework Convention on Climate Change (COP30) in Brazil.

Highlighting the long-standing history of environmental and climate cooperation between the two nations, Deputy Minister Doi described Viet Nam as one of Japan’s premier partners.

With COP30 marking a global shift from the "negotiation" phase to the "implementation" of climate action, bilateral frameworks like the JCM are becoming increasingly vital.

Established in 2013, the Viet Nam-Japan JCM aims to deploy advanced Japanese technologies to reduce greenhouse gas emissions. Currently, Viet Nam has 51 major projects eligible for the mechanism, drawing significant interest across various ministries. However, the current global economic climate and rising costs have created hurdles for project implementation.

During the meeting, the Japanese delegation provided feedback to Deputy Minister Le Cong Thanh regarding Viet Nam's draft government decree on the international transfer of mitigation outcomes (ITMO) under Article 6.2 of the Paris Agreement. Japan noted that the current JCM methodology utilizes reference emissions baselines rather than "Business As Usual" (BAU) scenarios, ensuring a high degree of prudence and accuracy.

Deputy Minister Le Cong Thanh acknowledged the input, stressing that the rapid pace of technological advancement requires flexible and timely policy updates. He noted that Viet Nam is actively learning from leading nations, including Japan.

When the JCM was launched over a decade ago, information regarding carbon credits was limited, even among government agencies. Today, with the European Union implementing the Carbon Border Adjustment Mechanism (CBAM) and shifting climate commitments from the US, the issue requires meticulous consideration.

A significant challenge remains the lack of comprehensive, consistent data. Deputy Minister Thanh requested Japan’s assistance in building a shared database for the JCM community to be accessible by Vietnamese ministries, thereby enhancing transparency and reliability in policymaking.

In the waste management sector, Japan is currently supporting a waste-to-energy project in Bac Ninh province under the JCM. Deputy Minister Doi reported that initial results demonstrate the Japanese technology is operating effectively and is well-suited to Viet Nam’s conditions.

He also welcomed Viet Nam's expansion of Extended Producer Responsibility (EPR), noting that the mechanism facilitates the recovery of minerals and materials during recycling, reducing pressure on natural resource extraction.

Deputy Minister Thanh highlighted the challenges Viet Nam faces in formulating EPR policies and expressed a desire to draw on Japanese expertise. He requested continued support in developing standards, regulations, and technical guidelines for solid waste management, source separation, plastic recycling, waste-to-energy technologies, and the EPR mechanism.

Furthermore, both sides agreed to promote cooperation within the circular material value chain to lower emissions in the materials sector-a key theme emphasized at COP30.

According to Deputy Minister Thanh, Viet Nam is drafting a new decree on EPR and plans to amend the Law on Environmental Protection by May 2026, which will include a dedicated chapter on the circular economy.

Both leaders expressed a commitment to maintaining regular communication to ensure businesses in both countries can effectively access cooperation opportunities in emission reduction, waste management, and circular economy development. The Ministry of Agriculture and Environment accepted Japan's proposals regarding the ITMO draft decree and welcomed expanded bilateral collaboration on emission reduction in the near future.

Viet Nam and Japan have cooperated on climate and environmental issues for more than a decade, with the Joint Crediting Mechanism (JCM) serving as a central pillar. Launched in 2013, the JCM enables the deployment of advanced Japanese low-carbon technologies in Viet Nam to generate verified emission reductions. Viet Nam currently has 51 registered JCM-eligible projects spread across energy efficiency, waste treatment, and industrial processing, drawing strong attention from multiple ministries. Japan applies reference emissions baselines rather than “Business As Usual” (BAU) benchmarks, a methodology that emphasizes accuracy and prudence in calculating carbon credits.

As countries move from negotiation to implementation under COP30, the role of high-quality carbon markets, especially international credit transfers under Article 6.2 of the Paris Agreement, has become increasingly important. Japan is among Viet Nam’s earliest partners to provide technical comments on the country’s draft decree governing the transfer of mitigation outcomes (ITMO).