November 16, 2023 | 11:30 GMT+7

Finance sought to promote circular economy

Trâm Anh -

Businesses will need to invest in new machinery and equipment using clean energy to boost the circular economy.

The circular economy and green finance should be considered priority areas in order to implement the National Strategy on Green Growth for the 2021-2030 period and vision to 2050.

According to experts, the financial resources being mobilized to implement the national strategy on climate change and green growth are insufficient compared to actual needs.

For businesses to promote the circular economy they must invest in new machinery and equipment that efficiently use clean energy, but their financial capacity is also limited and this poses a major obstacle to the transition.

In addition, the implementation of a circular economy in Vietnam is challenging because models are still in their infancy, the legal framework remains incomplete, and awareness about relevant authorities, businesses, and consumers is limited.

Associate Professor Bui Quang Tuan, Director of the Vietnam Institute of Economics, said there are three potential paths to meeting requirements in green finance.

First, focus on promoting private investment both in new technologies and more resilient infrastructure.

Second, increase funding from the State budget by raising additional revenue through carbon taxes or by borrowing from domestic and international markets, within certain limits, to avoid burdening the government with future debt.

Third, mobilize additional revenue from international financial sources, including investment organizations and multilateral and bilateral donors, FDI sources, and remittances.

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