15 Jul 2022
Vietnam would need to spend $368 billion between now and 2040 to mitigate the impact of climate change and progress with its development targets.
This is according to a report published by the World Bank.
Vietnam is one of the world’s most vulnerable countries to rising sea levels and extreme weather, Bloomberg reports. Without implementing adequate mitigation steps, investing around 6.8% of annual GDP, climate change may end up costing the country 14.5% of its GDP by 2050, according to the report’s findings.
“Vietnam should embrace a new development paradigm based on two connected pathways—to adapt to climate change and build resilience, and to mitigate climate change by decarbonizing growth and steering the economy away from carbon-intensive energy,” the report stated.
Should it take this course, Vietnam could reach its climate goals whilst increasing its GDP per capita by over 5% per year, according to the World Bank’s report.
In addition, the required public and private investments need to be complemented by structural and policy reforms such as a carbon pricing mechanism.
“Vietnam cannot be timid on climate change. It must act, and it must act boldly,” stated Darryl J. Dong, acting country manager for Vietnam at the International Finance Corporation, the World Bank Group’s private sector division. Dong was speaking at the Hanoi conference to unveil the report on Thursday.
“Adaptation and mitigation will not be easy, will not be cheap, and the reality is there no choice. Major financing is needed,” he added.
Dong stated that according to the World Bank Group’s Vietnam Country Climate and Development Report, $370 billion is needed over the next 18 years to enable the country to prepare for climate change. Moreover, he said the private sector will be required to commit to at least 50% of the funding: “Private sector financing will be key,” he said.