Investors propose that Ho Chi Minh City establish a 'green startup center'.

Investors have proposed that Ho Chi Minh City establish an incubation center for startups in the green economy sector to facilitate attracting capital and piloting policies.

The idea was raised by several investors during a meeting between the Chairman of the Ho Chi Minh City People's Committee, Phan Van Mai, and nearly 20 leaders of investment funds and organizations from both domestic and international sources on the evening of December 8th, as part of the final round of the "Net Zero Challenge 2023" competition.

Mr. Tran Nhat Khanh, Founder of Touchstone Partners (Vietnam), said that while the country and Ho Chi Minh City have many incubators and startup accelerators, none are specifically dedicated to "green startups" - that is, projects related to sustainable development, contributing to emission reduction and aiming for carbon neutrality.

Therefore, he suggested that Ho Chi Minh City should consider establishing a "Green Hub." Besides incubating startups, this hub would also serve as a point of contact for investors interested in this field, as well as help resolve administrative procedures and pilot support policies by maximizing the use of Resolution 98 on special mechanisms for the city. "In terms of model, I propose a public-private partnership for the Green Hub," Mr. Khanh stated.

Mr. Tran Nhat Khanh, Founder of Touchstone Partners (left), and Mr. Juhern Kim, Head of Vietnam of Global Green Growth Institute, at a meeting on the evening of December 8th. Photo: Viễn Thông.

Mr. Phan Nhat Minh, Head of the Vietnam branch of Gobi Partners (Malaysia), is also interested in locations in Ho Chi Minh City where support mechanisms (sandbox model) for green startups can be piloted.

Based on his practical experience, Mr. Minh said that the green economy is a broad and new field, but when green startups register to establish businesses, they have to choose traditional industry codes because there is no separate industry code for the green economy.

"Some startups focused on the green economy are classified under the environmental sector. This is a conditional business sector with restrictions on foreign investment," he said. Therefore, to attract foreign capital into green startups, a green economy sandbox needs to be implemented, similar to the sandbox plan in the financial sector, according to Mr. Minh.

Responding to the proposal for Green Hub, Chairman of the Ho Chi Minh City People's Committee Phan Van Mai agreed that some of the industries being developed by green startups are new and not yet covered by regulations for business registration. Therefore, a center is needed to accelerate and implement pilot policies.

"With Green Hub, we can design and propose to the competent authorities that it be a legally recognized address with operating regulations, so that it can function as a sandbox," Mr. Mai summarized the idea.

Chairman of the Ho Chi Minh City People's Committee Phan Van Mai speaks at a meeting with leaders of nearly 20 investment funds and international organizations on the evening of December 8. Photo: Vien Thong .

Besides the Green Hub proposal, several organizations are also interested in the prospects of the green bond and carbon credit markets. Alex Downs, Investment Manager of the Netherlands Climate and Development Fund (DFCD), said he is waiting for the carbon credit market to develop.

Meanwhile, the intergovernmental organization Global Green Growth Institute is ready to participate in discussions with Ho Chi Minh City if the locality intends to implement green bonds. In addition, the Chief Representative in Vietnam, Juhern Kim, wants to open an office in Ho Chi Minh City soon, alongside the existing office in Hanoi .

According to the green growth strategy framework to 2030, with a vision to 2050, Ho Chi Minh City focuses on four pillars: green resources (highly skilled human resources, green finance, green connectivity/cooperation); green infrastructure (green energy transition, clean water - water conservation, resource circularity); green behavior (green consumption, green transportation, green construction); and priority sectors/fields (high-tech manufacturing, green startups - innovation, green tourism , green food, Can Gio Green).

Mr. Lim Hock Chuan, Director of the Temasek Foundation Program (Singapore), recommended developing a green economy through a public-private partnership (PPP) model and expressed his willingness to participate. "I suggest that Ho Chi Minh City share more detailed information about the strategic pillars so that we can better understand how it can participate specifically," he said.

Temasek Foundation, along with Touchstone Partners and the Ho Chi Minh City Institute for Development Research, also co-organized the "Net Zero Challenge 2023". On the afternoon of December 8th, the competition announced the three best teams. Among them, Alterno won the "Renewable Energy & Carbon Neutrality" category with their solution for producing a low-cost thermal energy storage system using sand cells.

Forte Biotech topped the "Sustainable Food Systems & Agriculture" category with its on-site rapid diagnostic testing solution for shrimp diseases. AirX Carbon was named in the "Circular Economy & Waste Management" category for producing plastic alternatives from bio-waste at a competitive cost.

Out of more than 300 applications from 45 countries, these three projects received a 15 billion VND prize (non-convertible to shares) for practical implementation. Following its first edition in Vietnam, Mr. Phan Van Mai stated that he will research ways to soon make "Net Zero Challenge" an official green startup competition of Ho Chi Minh City.

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