Japanese companies look forward to Vietnam's progress in regulatory reform to participate in the green growth sector, according to Takeo Nakajima, Chief Representative of the Japanese External Trade Organization (JETRO) in Hanoi.

Solar panels installed on the roof of a Vietnamese manufacturer. Photo: Khac Kien/The Hanoi Times

Takeo said that green growth is an inevitable trend as the two nations enter a new era of bilateral relations.

Japan experienced high socio-economic growth and environmental pollution at the same time in the 1970s of the 20th century. Therefore, Japan can share its experience and help Vietnam stay on the path of sustainability in the future.

As of the end of August 2023, Japanese companies run nearly 5,200 projects in Vietnam with a total registered capital of US$71 billion. Japan currently ranks third among 143 countries and territories investing in Vietnam, and Japanese companies are increasingly interested in Vietnam's green growth sector.

A recent survey by JETRO shows that about 60% of Japanese companies are considering expanding their operations in Vietnam, higher than the ASEAN average of 46%.

According to the Ministry of Natural Resources and Environment (MONRE), Vietnam was the world's 21st largest greenhouse gas emitter by 2021 and the second largest in ASEAN.

In the global Environmental Protection Index (EPI), Japan ranked 25th in the world with 57.2 points, up 3.2 points from the previous year, and Vietnam ranked 178th with 20.1 points, down 0.6 points.

Takeo said that such problems happen to every economy and require the Vietnamese Government to take drastic measures.

Critical issues in Vietnam include water and air pollution, waste management and recycling, energy efficiency, and carbon emissions, he said at a workshop this week.

Speaking at a workshop on green growth hosted by the national English-language daily Viet Nam News, JETRO's chief representative advised that Vietnam should "implement stricter environmental regulations, expand the environmental responsibilities of manufacturers, and accelerate the transition to renewable energy sources".

According to Vuong Thi Minh Hieu, deputy head of the Department of Industrial Zones under the Ministry of Planning and Investment (MPI), Vietnam raised about US$11.5 billion for green growth projects in 2012-2020.

The figure includes US$2.5 billion from the state budget for the Mekong Delta and US$9 billion from international companies for renewable energy projects and the provision of equipment and facilities.

"The capital structure shows that private investors are the key to green growth. Vietnam prioritizes attracting more investment in high technologies that add value and connect the Vietnamese economy to the global value chain," she said.

She added that the Vietnamese Government's top priorities for the coming years include pushing forward administrative reforms to support Vietnamese and foreign businesses, building green agricultural infrastructure, applying advanced technologies, and improving human resources.

Speaking at the workshop, Vu Viet Trang, General Director of the Vietnam News Agency, said green growth is a common goal for Vietnam and Japan.

"The two governments have made several joint projects in green growth. The sector has great potential for the two nations to explore," she said.

Kubo Yoshitomo, deputy chief representative of the Japan International Cooperation Agency (JICA) in Vietnam, said the agency has helped Vietnam adopt green growth solutions in agriculture, climate change, disaster prevention, and renewable energy.

He said JICA will work with MONRE to improve Vietnam's capacity to reduce carbon emissions and enhance water management, and cooperate with agricultural enterprises to improve the living standards of local people and apply modern technologies to minimize the impact of climate change and natural disasters on their lives.