Vietnam needs 368 billion USD to adapt to climate change

According to the World Bank's Vietnam Country Climate and Development Report, Vietnam is among the most vulnerable countries to climate change in the world. This is due to a long coastline of 3,260 km and various low-lying areas scattered throughout the country. 

According to the report, Vietnam lost approximately 10 billion USD in 2020, equivalent to 3.2% of the national GDP, due to climate impacts. The total economic costs caused by climate change could reach 523 billion USD by 2050. More than 70% of the land area in ​​some provinces and cities has the possibility to be flooded within the next 80 years. 

Areas that suffer the most damages include: Urban areas and industrial zones, especially in and around Ho Chi Minh city; and The Mekong Delta, home to 18 million people.

According to the World Bank's Research Group, Vietnam's contribution to the total global greenhouse gas emissions is only 0.8%. However, the rapid economic growth in the past has quadrupled the greenhouse gas emissions per capita in the past 20 years: from 0.79 tons of CO2 in 2000 to 3.81 tons of CO2 in the year 2018.

This is the quickest growth rate in the world - WB's report emphasized.

Ms. Manuela Ferro, World Bank Regional Vice President for East Asia and Pacific shared: "Vietnam must devote great resources to protecting the country's largest city, Ho Chi Minh City, its low-lying coastline and the Mekong Delta from the impacts of climate change".

In addition, in order to reduce greenhouse gas emissions, as well as fulfill the commitment of zero net carbon emissions by 2030, Ms. Ferro recommended Vietnam to take strong action in industries with excessive greenhouse gas emissions such as energy, transport, agriculture, processing and manufacturing; as well as reduce the adverse effects of climate change on trade and investment.

Vietnam is currently committed to ending deforestation by 2030, reducing methane emissions by 30%, and ending all investments in new coal power generation, scaling up renewable energy deployment, and removing coal power by the 2040s.

To help Vietnam achieve these ambitious goals, the World Bank's Vietnam Country Climate and Development Report proposes solutions with regards to two aspects: Increasing resilience to climate impacts, and gradually reducing carbon-intensive energy sources in the economy.

The WB also proposes five priority policy packages. Firstly, issue a regional program for the Mekong Delta, which accounts for 50% of the total national rice production and a third of the national agricultural GDP. This area currently faces many risks such as coastal, riverbanks erosion, rising sea level and saltwater intrusion.

Other specific policies, suggested by the World Bank, include limiting sand mining and groundwater exploitation, investing in infrastructure, and supporting people's livelihoods.

Secondly, promulgate an integrated plan to protect coastal urban areas and connect traffic in the region. The plan includes: upgrading road and energy systems, strengthening early weather warning and risk management systems.

Thirdly, issue a plan to reduce air pollution around Hanoi, where fine dust concentration is continuously increasing and the air quality is poor, exceeding 5 times the limit under the guidelines of the World Health Organization from 2018 to 2021.

Fourthly, accelerate the transition to renewable energy sources by encouraging the private sector to invest in increasing grid capacity and practice energy saving.

Fifthly, research social security policies to offset the economic impacts that climate change solutions may have on people. Fundings for the research can come from carbon tax revenue.

In terms of costs, the World Bank's Report estimates the value of additional investment in climate change adaptation and mitigation measures between 2022 and 2040 at up to 6.8% of Vietnam's annual GDP, which is equivalent to approximately 368 billion USD.

Without timely mitigation measures, climate change could put 1 million Vietnamese people in extreme poverty by 2030, according to the World Bank. 

Alfonso Garcia Mora, Vice President in charge of the Asia-Pacific region under the International Finance Corporation (IFC), emphasized: "Vietnam has two goals: becoming a high-income country and a zero net carbon emitter in the next 30 years. To accomplish such goals, Vietnam must mobilize a large amount of private capital."

In addition to researching and issuing carbon taxes or regulations related to emissions trading, Mr. Mora recommended Vietnam to "greenify the financial sector, promote green growth projects in different sectors". According to him, this will be the key to Vietnam's success in achieving the "dual goals" of development and adaptation to climate change.