Macroeconomic Reforms/ Green Growth

Project description

Title: Macroeconomic Reforms/ Green Growth
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Socialist Republic of Viet Nam
Lead executing agency: Ministry of Planning and Investment (MPI)
Overall term: 2019 to 2021

Context

The last decade has witnessed continuous efforts by the Vietnamese Government pursuing a more inclusive and environmentally sustainable growth model. The national Socio-economic Development Plan (SEDP), together with other strategies and policies, has set the path for Viet Nam’s stable economic growth in recent years and cements Viet Nam’s commitment to the Sustainable Development Goals and international integration. 

Despite the existence of these plans and strategies, their implementation remains challenging due to the lack of policy coherence and consistence, inadequate capacity, technical knowledge, expertise and resources. 

Objective

The coherence of Viet Nam's economic policies, including green economic policies, green fiscal policies, green finance policies and public financial management are strengthened.

Approach

On behalf of the German Ministry for Economic Cooperation and Development (BMZ), the Macroeconomic Reforms/Green Growth Programme supports the Vietnamese government in developing and implementing macroeconomic reforms towards a green and inclusive model of growth. The programme provides technical advisory and capacity development services to the key government agencies implementing the Viet Nam Green Growth Strategy (VGGS): the Ministry of Planning and Investment (MPI), the Central Institute for Economic Management (CIEM), the Ministry of Finance (MoF), the State Bank of Viet Nam (SBV), and the State Securities Commission (SSC). 

The programme supports the MPI to coordinate the implementation of green growth measures at the national level. This encompasses the development of relevant indicators to monitor the progress towards sustainable green economy and various regulations to enhance green investment. The programme also provides capacity building measures to assist CIEM in formulating policy recommendations for green and digital transformation of the growth model based on cutting edge research. GIZ supports SBV, SSC and other relevant stakeholders to promote reforms of the financial market to increase green private investment, for example by issuing regulation for green credit, green bonds and a green stock exchange. Finally, the programme also cooperates with the MoF to enhance the sustainability and effectiveness of public financial management, for example through increasing transparency of the state budget and revising green fiscal policy instruments.

Results

  • The Viet Nam Set of Indicators for Sustainable Development (VSDGI) is officially integrated into the official statistics of Viet Nam. The 2019 population census included questions to collect data on those indicators for the first time, thereby monitoring the progress towards the achievement of Sustainable Development Goals (SDGs).
  • The new Decree on Environmental Protection Charge for Wastewater increased the fee for industrial wastewater treatment thereby incentivising production facilities to reduce their on-site water intensity.  
  • The Ministry of Finance increased the transparency of the state budget by publishing the information in the publication “Citizens’ Budget” 2020.
  • According to a 2019 survey of the State Bank of Viet Nam, the awareness of credit institutions on green credit has increased and contributes to fostering private investment in green growth.

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