The establishment of this exchange will provide a platform for businesses to trade carbon credits, fostering investment in sustainable projects and driving emission reductions. In preparation of this launch, it is important to understand the two main carbon credit types that will be traded.

Understanding Carbon Credits: Compliance vs. Voluntary

As Vietnam prepares to enter the carbon market, it's essential to distinguish between compliance and voluntary carbon credits:

Vietnam's Commitment to Sustainable Development

The Vietnamese carbon trading exchange will create a space for the trading of both compliance and voluntary carbon credits. The exchange will provide a method for companies to meet mandatory requirements, and also a place for companies to voluntarily offset their carbon footprint.

The launch of the carbon trading exchange reflects Vietnam's commitment to sustainable development and its active participation in the global effort to combat climate change. By establishing a robust carbon market, Vietnam aims to:

• Drive investment in green technologies and sustainable projects.

• Promote corporate environmental responsibility.

• Contribute to its national emission reduction targets.

The pilot phase of the carbon market will run from June 2025 to the end of 2028, with full operational status expected in 2029. During the pilot phase, the government will continue to refine regulations and infrastructure to ensure the market's efficiency and effectiveness.