Agribank , as the leading state-owned commercial bank in investing in agriculture and rural areas, is affirming its pioneering position by not only providing capital but also paving the way for Vietnamese carbon credits to reach out to the international market.
From biomass wood credits to carbon opportunities
Vietnam is the first country in the East Asia and Pacific region to receive a $51.5 million result-based carbon emission reduction payment from the World Bank’s Forest Carbon Partnership Facility (FCPF). The payment will benefit 70,555 forest owners and 1,356 forest-adjacent communities in six provinces, distributed according to a transparent, equitable and participatory plan. This demonstrates how the “invisible asset” of carbon credits can become a sustainable source of income for both communities and countries.
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With 14.7 million hectares of forest, a tropical climate and fast crop growth, Vietnam is facing a unique opportunity: from a country with potential, Vietnam can rise to become a leading supplier of carbon credits in the region. But to turn the potential into reality, the prerequisite is a long-term, sustainable capital flow, helping businesses invest in technology, infrastructure and meet strict international standards on certification and data transparency.
In that context, Agribank has taken the lead in accompanying businesses. The signing of credit contracts with Van Lang Yufukuya Company and Lam Thanh Hung Company in Thanh Hoa not only provides financial resources but also instills confidence in businesses to boldly pursue green projects, contributing to building a carbon economy .
Located in Nghi Son Economic Zone, Van Lang Yufukuya Co., Ltd. specializes in producing wood chips and wood pellets, two products in high demand in Japan, Korea and Europe for biomass energy production. Since 2020, Agribank has accompanied this enterprise with a credit limit of VND 200 billion, of which VND 161 billion has been disbursed to date. The timely disbursement helps Van Lang maintain its raw material supply chain, ensure export progress, and have more resources to expand the market and upgrade its biomass wood processing line.
Notably, Van Lang only purchases raw materials from FSC (Forest Stewardship Council) certified units and makes direct payments for each imported shipment. This not only meets the market's requirements for transparency and sustainability but also affirms its long-term development orientation associated with international standards.
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Mr. Lang Van In, Chairman of the Board of Members of Van Lang Yufukuya Company Limited, took Agribank staff to visit the company's production model. |
Unlike Van Lang, Lam Thanh Hung Company Limited, headquartered in Tuong Linh Commune, focuses on the production of wood chips and laminated boards. The company was granted a credit limit of VND80 billion by Agribank and has disbursed the entire amount. This capital has helped the company expand production and at the same time improve its competitiveness in the international market.
What is special is that Lam Thanh Hung manages 700 hectares of forest in 4 communes: Cong Liem, Cong Chinh, Tuong Son, Tuong Linh (Nong Cong district, Thanh Hoa). This is an area rented from 258 households, and the company has fully paid the forest rent, and continues to pay directly to households each time it imports raw materials. This model not only ensures a stable supply but also creates income for the local community, building a fair benefit sharing mechanism, an important factor for sustainable development.
At first glance, the loans to Van Lang and Lam Thanh Hung look like traditional timber production loans. But in fact, they are a key link in the carbon value chain. From planting raw materials, processing biomass to exporting, each activity contributes to absorbing CO₂ and creating emissions reductions that can be measured, reported and verified (MRV). When meeting international standards, these emissions reductions will be certified as carbon credits and can be sold on voluntary or compulsory markets.
Thus, Agribank’s credit not only helps maintain production activities but also serves as a “leverage” for Vietnamese enterprises to enter the global carbon market worth hundreds of billions of dollars. This is proof of how commercial banks can become a “bridge” between the traditional agricultural economy and the green economy of the future.
Mr. Lang Van In, Chairman of the Board of Members of Van Lang Yufukuya Co., Ltd. shared: “The loan from Agribank is the key to helping us invest in the biomass wood processing line and develop the afforestation project. Despite favorable policies with the support of Decree 06/2022/ND-CP and Decision 888/QD-TTg, we still face many challenges: high MRV monitoring costs, complicated international certification procedures, and pressure on data transparency. Without the support from Agribank, we would hardly have gone this far.”
Agribank’s capital not only helps businesses maintain production but also serves as a stepping stone for them to participate in the green economy, where value comes not only from wood products but also from reduced emissions. Thanks to that, biomass wood credit does not stop at nurturing the forestry industry but also opens a “gateway” for Vietnamese businesses to exploit the benefits of carbon credits, an intangible asset that is increasingly valued.
From Lam Thanh Hung, the business representative also emphasized: “The capital support not only helps them maintain the forest processing chain but also opens up access to potential carbon credit markets in Japan, the EU and Korea. We believe that carbon credits will become a sustainable source of income alongside traditional wood products, thereby creating a solid financial foundation.”
“Vote of confidence” gradually affirms position in the global carbon value chain
Obviously, Agribank’s timely provision of capital has helped businesses meet international standards, stabilize production flows, and maintain prestige with foreign partners. Thanks to that support, not only Van Lang Yufukuya or Lam Thanh Hung but also Vietnamese wood enterprises have the opportunity to expand not only the export market but also enter the international “playground” of carbon credits - a market worth more than 900 billion USD in 2024 and continuing to grow.
If businesses “create” carbon credits, banks are the “bridge” that helps those products reach the market. As a leading financial institution in the agricultural and rural sector, Agribank understands better than anyone the potential of Vietnamese forests in the global carbon value chain.
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Agribank staff appraise the enterprise's forestation project. |
Agribank's financing of businesses not only contributes to promoting clean production, but also directly supports the national goal of Net Zero 2050. This is also an opportunity for Agribank to expand its credit portfolio into the field of carbon finance - a potential area, helping to increase income from service fees, guarantees, international payments, while enhancing the image of a green and sustainable bank brand.
In particular, when businesses have additional stable revenue from carbon credits, banks also benefit from strengthened debt repayment capacity, minimizing credit risks. This is a “win-win” relationship, in which Agribank both fulfills its social responsibility and increases its competitive advantage in the financial market.
Not only credit, credit projects require a modern monitoring, reporting and verification (MRV) system, digital data and transparency. This is the "gateway" for Agribank to promote its digital transformation strategy, providing cross-border payment solutions, cash flow management and digital banking services to customers. Thus, a green credit loan also opens up many other modern financial services, closely linking businesses with banks.
From the credit buyers’ perspective, initial assessments show that transactions from Vietnam are increasingly being welcomed. A representative said: “The credits we buy from Vietnamese enterprises all fully meet the legal basis, technical standards and environmental values. This is a high-quality source of credits that can be re-traded or used immediately in emission reduction commitments. More importantly, it contributes to affirming the reputation of both the seller and the buyer in the international market.”
This proves that not only businesses and banks benefit, but the international market also appreciates Vietnam’s efforts. Each successful transaction not only brings in revenue but is also a “vote of confidence” that helps Vietnam gradually affirm its position in the global carbon value chain.
It can be seen that the international carbon market is opening up a “highway” for the green economy, but only those with the capacity can step onto this runway. With its position as the largest state-owned commercial bank and a widespread network, Agribank is the strategic bridge for Vietnam’s carbon credits to reach out to the world.
That journey requires not only capital, but also technology, governance and above all, strategic vision. Agribank, with its ESG commitment and mission of “Banking for the community”, is proving that green finance is not a slogan but a practical action to help businesses improve their capacity, countries implement their Net Zero commitment and Vietnam will firmly stand on the global carbon map.
Source: https://baodautu.vn/ngan-hang-muon-lam-cau-noi-chien-luoc-dua-tin-chi-carbon-viet-nam-ra-thi-truong-quoc-te-d371525.html
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