In recent decades, green investment has emerged as a crucial pillar of sustainable growth, linking economic benefits with environmental and social responsibility. This trend is becoming increasingly evident as the world faces pressures from climate change, resource depletion, and the need to shift development models towards green, circular, and low-emission practices.
In many regions such as the European Union, APEC, and ASEAN, green investment has become a mainstream trend reshaping development strategies, business behavior, and financial decisions. Beyond being an objective requirement, green investment opens up new avenues for development, attracting high-quality capital to support green transformation and achieve the Net Zero goal.
From various perspectives, green investment encompasses direct or indirect investment in projects, industries, and technologies aimed at protecting the environment, efficiently utilizing resources, conserving biodiversity, reducing greenhouse gas emissions, and adapting to climate change. On a broader level, green investment is linked to green finance, carbon markets, climate infrastructure, and the development of green technologies – areas that are increasingly attracting significant attention in the global financial sector.
Against the backdrop of the world needing to mobilize enormous resources to implement the Paris Agreement, the financial gap to limit temperature rise to no more than 1.5°C is widening. A 2023 report by the Climate Policy Initiative shows that the world needs approximately $4.3 trillion annually until 2030, while existing capital flows only reach about $1.3 trillion. This underscores the crucial role of green investment in balancing development goals and climate goals, and highlights the urgent need for each country to improve its mechanisms for effectively mobilizing and allocating green resources.
Alongside global efforts, many countries have developed green financial policy frameworks, standards, and tools to direct capital flows into priority sectors. The European Union stands out with its EU Taxonomy, China has developed a portfolio of projects financed by green bonds, and ASEAN has issued a set of green bond standards in line with international practices. These are crucial foundations for promoting a robust, transparent, and unified green capital market.
In Vietnam, green investment is identified as an essential path to achieving net-zero emissions by 2050. The issuance of the Green Classification List under Decision 21/2025/QD-TTg has created a significant step towards perfecting the legal framework and standardizing green investment activities, while also helping Vietnam integrate more deeply with international practices. Given the growing demand for capital for green transformation, studying international trends and experiences is crucial for supporting policy development, developing a green finance market, and attracting high-quality resources for sustainable development.
The global green finance market has grown rapidly in size, structure, and product diversification over the past decade. According to the Climate Bonds Initiative, the total value of issued green and sustainable debt instruments has exceeded $3.5 trillion, with green bonds accounting for the largest share. In 2023 alone, green bond issuance reached nearly $520 billion, and by the end of 2024, the total volume of climate bonds traded is estimated to exceed $1.05 trillion, an 11% increase from the previous year. This reflects the growing demand from both the public and private sectors for investment in projects aimed at reducing emissions and adapting to climate change.
Along with its expansion in scale, the global green finance market has also witnessed a significant shift in issuer structure. Banking institutions account for the largest share of green bond issuance, followed by businesses, governments , local authorities, and development banks. This indicates that the green finance market is increasingly expanding to include a wider range of entities, enhancing the diversity and stability of green capital flows.
In terms of sector allocation, renewable energy remains the largest destination for green capital flows, followed by sustainable transportation, climate-resilient urban infrastructure, and sustainable agriculture. Investment in clean energy and the electrification of transportation is seen as a key driver towards achieving Net Zero by 2050.
Major economies, including China, have developed well-structured green finance strategies with standardized systems, preferential credit mechanisms, and green investment portfolios updated according to international best practices. In China, since 2015, a series of green finance policies have been implemented, rapidly transforming the country into one of the world's largest green bond markets. Green transportation, renewable energy, new industries, and energy efficiency account for a significant portion of China's green credit portfolio.
Along with the strong growth of green bonds, many new financial instruments have emerged to meet the diverse needs of investors. Products such as green convertible bonds, sustainable linked bonds, carbon credit-based instruments, and hybrid financial models are increasingly being widely adopted.
Malaysia is a prime example of a country developing a comprehensive green financial ecosystem, organized according to a five-pillar model encompassing financial instruments, investors, issuers, internal governance, and information infrastructure. Notably, Malaysia pioneered the issuance of SRI Sukuk – a form of green Islamic bond – highlighting green finance in Southeast Asia.
The rapid development of the green finance market necessitates standardization and transparency. Amidst the increasing risk of "greenwashing," numerous international oversight mechanisms and standards have emerged to ensure market integrity. The Green Bond Principles of the International Capital Markets Association are a widely used standard, defining principles for capital utilization, disclosure, due diligence processes, and impact reporting. Compliance with these standards is considered crucial for increasing investor confidence, especially among large funds pursuing ESG strategies.
Looking at international experience, several important lessons can be drawn for Vietnam.
Firstly, it is necessary to quickly finalize the system of standards and regulations related to green finance, aligning them with international frameworks such as the EU Taxonomy or the ASEAN BPA. This will provide a basis for guiding capital flows, building investor confidence, and reducing the risk of greenwashing.
Secondly, developing a green financial ecosystem requires the synchronized participation of the state, businesses, and financial institutions. Besides preferential policies on taxes, credit, and guarantees, Vietnam needs to develop transparent green data, increase the environmental risk assessment capacity of credit institutions, and promote the disclosure of ESG information by businesses.
Thirdly, diversifying green financial instruments is a crucial direction for expanding capital mobilization capabilities, especially through hybrid finance models combining public and private resources.
The new context requires Vietnam to continue proactively accessing international experience, flexibly applying it to domestic conditions, and building a green financial market according to high standards. Once these foundational elements are strengthened, green investment will become a crucial driver of green growth, enhancing the competitiveness of the economy and contributing to Vietnam's strong commitment to the international community on sustainable development and climate change adaptation.
Source: https://mst.gov.vn/dau-tu-xanh-xu-the-toan-cau-va-nhung-goi-mo-chinh-sach-cho-viet-nam-197251210170439759.htm
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