In late 2023, MARD transferred 10.3 million tons of CO2 to the World Bank under an agreement. The World Bank released a letter of confirmation and transferred back 95 percent of the emission reduction results to Vietnam for the country’s NDC (nationally determined contributions) as committed within the framework of ERPA (Emissions Reduction Purchase Agreement) and the regulations in Decree No 107/2022.

Prior to that, the World Bank sent an official letter to MARD confirming the results of the emission reductions in the north central region in 2018-2019, with 16.21 million tons of CO2. Of this, 10.3 million tons of CO2 were transferred to the World Bank under ERPA.

ERPA says that the World Bank has the right to additionally buy up to 5 million of CO2, at the price of $5 per ton, and 95 percent of transferred results will be transferred back to Vietnam for its NDC.

The World Bank proposed the additional purchase of 1 million tons of CO2 from emission reductions in the north central region created in the 2018-2019 period. MARD has reported to the Prime Minister about the proposal, suggesting the plan on transferring another 1 million tons of CO2 to the World Bank in accordance with the signed ERPA. It also suggested a solution to deal with the 4.91 million tons of CO2 in 2018-2019 in the documents sent before.

MARD has consulted with ministries and people’s committees of six provinces in the north central region on the plan to transfer 1 million tons of CO2 to the World Bank and proposed dealing with the remaining carbon volume.

The government has assigned MARD to represent the government and forest owners in the six provinces to transfer 1 million tons of CO2, which is within the additional 5 million tons that the World Bank has the right to ask for during ERPA implementation.

The transferred emission reductions were results created in the past (2018-2019), so it is very difficult to seek other partners for exchange and trade and the volume of carbon may devalue after a long time. The domestic carbon market is expected to be established and become officially operational in 2028.

To continue mobilizing resources for forest protection and development, MARD has proposed that the Prime Minister allow the ministry to transfer an additional one million tons of CO2 to the World Bank.

As for the remaining 4.91 million tons of CO2, Vietnam has the right to transfer that to other potential partners.

Tam An