Vietnam receives US$51.5 million payment from World Bank for emission reduction through forest conservation

01:50 22/03/2024

Ha Noi, 21 March 2024 — Vietnam has received a payment of US$51.5 million for verified emissions reduction outcomes (“carbon credits”) due to limiting deforestation and forest degradation (commonly known as REDD+) and enhancing carbon storage through planting and regenerating forests. Vietnam is the first country in the East Asia Pacific region to receive an emissions-based payment from the World Bank’s Forestry Carbon Partnership (FCPF).

This payment was transferred to Vietnam due to a reduction of 10.3 million tonnes of carbon emissions for the period from 1 February 2018 to 31 December 2019. This is the largest single payout ever from the FCPF Fund for verified and high-quality emissions reduction results. The money will benefit 70,555 forest owners and 1,356 communities living near them, divided under a broad benefit-sharing plan developed through a transparent consultation process with multiple participants.

“The success of the REDD+ programme brings Viet Nam closer to implementing its ambitious Nationally Determined Contributions (NDCs) under the Paris Agreement on climate change, while protecting areas critical for biodiversity conservation, ” said Vietnam’s Minister of Agriculture and Rural Development Le Minh Hoan.

Vietnam has obtained emission reduction results beyond the volume contracted with the FCPF Fund and can sell this excess volume of emission reductions to third parties through bilateral agreements or carbon markets. Viet Nam can also use these outstanding emission reduction results for its Nationally Determined Contribution (NDC) or retain it for its climate goals.

“This landmark payment marks another step for Vietnam to enter the global carbon credit market and opens up a new opportunity to finance the country’s ambitious climate commitments and goals,” said World Bank Country Director for Vietnam Carolyn Turk.

The program generated 16.2 million verified emission reduction results for 2018-2019, 5.9 million more than the volume of 10.3 million in the Emission Reduction Payment Agreement. The World Bank has notified Vietnam of the exercise of the right to purchase an additional 1 million emissions reductions outside the number of contracts.

Vietnam’s emission reduction program protects the country’s rainforests, covering 3.1 million of the 5.1 million hectares of land in the program’s implementation area. These forests are ecologically important, including five internationally recognized conservation corridors. The region is also home to 12% of Vietnam’s population, including 13 ethnic minority groups and many forest-dependent communities. Nearly a third of the region’s population lives below the national poverty line. Through improved forest management, investment in the forestry sector, and strengthening agricultural policies, the program helps increase both the scope and quality of forest cover in partnership with local communities.

The Forestry Carbon Partnership (FCPF) is a global partnership that supports governments, businesses, civil society and indigenous organizations focused on reducing emissions from deforestation and forest degradation, conserving forest carbon stocks, sustainable forest management and strengthening forest carbon stocks in developing countries, the operation is often referred to as REDD+. Since the Foundation was established in 2008, the FCPF Foundation has worked with 47 developing countries in Africa, Asia, Latin America and the Caribbean, with 17 donors contributing and committing a total of US$1.3 billion.