The report stated that at the end of 2023, the Ministry of Agriculture and Rural Development transferred 10.3 million tons of carbon (CO2) to the World Bank (WB) according to the agreement. Immediately after that, the WB sent a letter confirming the transfer of about 95% of the transferred emission reduction results to Vietnam to contribute to the NDC according to the commitment in ERPA and the provisions of Decree No. 107/2022/ND-CP.

Previously, the World Bank sent a letter to the Ministry of Agriculture and Rural Development confirming the emission reduction results of the North Central region in the 2018-2019 period of 16.21 million tons of CO2. Of which, the amount transferred to the World Bank under ERPA is 10.3 million tons of CO2.

According to the signed ERPA, the WB has the right to purchase up to 5 million tons of additional CO2 at a price of 5 USD/ton, about 95% of the transfer results are transferred back to Vietnam to contribute to the NDC.

Currently, the WB proposes to purchase an additional 1 million tons of CO2 from the emission reduction results of the North Central region in the period of 2018-2019. The Ministry of Agriculture and Rural Development has reported to the Prime Minister , proposing a plan to transfer an additional 1 million tons of CO2 to the WB according to the signed ERPA; at the same time, proposing to handle 4.91 million tons of CO2 from the period of 2018-2019 in previously submitted documents.

The Ministry of Agriculture and Rural Development also consulted with ministries and People's Committees of 6 provinces in the North Central region on the plan to transfer 1 million tons of CO2 to the World Bank and proposed to handle the remaining amount of carbon.

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After transferring 10.3 million tons of CO2 to the World Bank, there are nearly 6 million tons of CO2 left in the 6 provinces of the North Central region in the period of 2018-2019. Illustrative photo

Regarding the transfer of an additional 1 million tons of CO2 to the WB within the maximum additional 5 million tons of CO2 under the signed ERPA, the Government assigned the authority to the Ministry of Agriculture and Rural Development to represent the Government of Vietnam and forest owners in 6 provinces in the North Central region to transfer to the WB during the implementation of the ERPA.

On the other hand, the emission reduction results from this transfer are the results created in the past (2018-2019 period), so it is very difficult to find other partners to conduct exchanges and trade, and will lose value over time. Meanwhile, the domestic carbon market will be established and officially operated in 2028.

Therefore, to continue mobilizing additional resources for forest protection and development, the Ministry of Agriculture and Rural Development proposes and recommends that the Prime Minister allow the Ministry to continue transferring an additional 1 million tons of CO2 to the WB.

For the remaining 4.91 million tons of CO2 from the emission reduction , the WB does not propose to purchase more. Therefore, Vietnam has the right to transfer to other potential partners.

However, up to now, the Ministry of Agriculture and Rural Development has not received any proposals from domestic and foreign organizations and partners on exchanging and transferring this amount of emission reduction. Accordingly, Vietnam can use this remaining amount of emission reduction to contribute to the national NDC.

In case there are organizations or partners interested in proposing to exchange or transfer, the Ministry of Agriculture and Rural Development will study and propose a plan to manage and use this revenue source, seek opinions from the Ministry of Finance, the Ministry of Natural Resources and Environment and the 6 North Central provinces, then report to the Prime Minister for consideration and decision to ensure that it does not affect the results of contributions to the NDC.

In case there is no agreement from the Prime Minister on the transfer of the remaining emission reductions of the North Central region in the period of 2018-2019 (including 1 million tons of CO2 as proposed by the WB and the remaining 4.91 million tons of CO2), the Ministry of Agriculture and Rural Development proposes to allow the ministry to send a letter to the WB regarding the non-transfer of an additional 1 million tons of CO2.

When the assessment and summary results of the implementation of Decree No. 107/2022/ND-CP are available, the Ministry of Agriculture and Rural Development will propose a management and use plan for the remaining emission reductions to report to the Prime Minister for consideration and decision.

Vietnam sells forest carbon credits: There is an organization that pays a minimum of 10 USD/ton of CO2. According to the agreement, Vietnam will transfer to LEAF/Emergent 5.15 million tons of CO2 to reduce emissions from forests in the South Central and Central Highlands regions during the period 2022-2026. The minimum payment is 10 USD/ton of CO2.