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Climate finance options for Vietnam’s transport climate change action plan

Hanoi, 2 April 2015 –

Vietnam has recently attracted international climate finance, however in the transport sector, there are lack of information on financial flows and sources, and the potential for accessing additional funding.

In Vietnam, the GIZ-TCC project works closely with the two agencies under the Ministry of Transport: Department of Environment (DoE) and Transport Development and Strategy Institute (TDSI). The TCC project is supporting the TDSI in developing the action plan to respond to climate change in the transport sector (2016-2020) with the scope of international lessons on climate change mitigation options, financial mechanism as well as co-organize some relevant workshops. On April 2 2015, an internal workshop was held by TDSI to have a preliminary discussion on climate finance, especially in transport sector. Firstly, a brief presentation on climate finance sources for Vietnam was delivered by the TDSI’s expert, where information on current financial flows have been mentioned and we have seen that most climate funding in Vietnam now is from international sources. Estimation shows that the cost of implementing the National Target Programme to Respond to Climate Change (NTP-RCC) will amount to around USD 93.5 million between 2009 and 2015. Until now, most climate funding has been distributed via the Support Program to Respond to Climate Change (SP-RCC). USD 240 million has been pledged by international and bilateral donor agencies towards the SP-RCC.

Following the presentation of TDSI, the GIZ-TCC gave a presentation on international climate finance options. This provided an overview of sources of international climate finance for transport mitigation and adaptation actions in Vietnam. As emission reduction has been given so much attention and emphasized strongly, mitigation actions could be the opportunity for transport sector in accessing climate finance. Beside the existing funds like GEF, CTF which support the mitigation actions, some new funding sources have been emerged such as NAMA and private investment. The first one, NAMA covers a broad of range of activities (planning, operations/maintenance, technology and capacity building) while private investment could be involved in the project implementation, building or maintaining infrastructure. In addition, challenges and recommendations to bridge the gaps have also been discussed to enhance understanding of Vietnam’s opportunities in accessing such finance.

To continue to further study, we have agreed on elaborating the selecting criteria for each fund, the current status of climate finance access in the transport sector. Additionally, the barriers should be identified for proposing the roadmap for accessing the funds.

In the course of 2015, TDSI and GIZ-TCC will continue to collaborate and organise more consultation workshops in support of the transport climate change action plan.

Highlights of the GIZ-TCC’s presentation [Link]

  • Key sources of climate finance including international climate finance and national budget.
  • Brief introduction of some international climate finance: ODA, multilateral funds (GEF, GCF, CIF, AF…) and bilateral funds (JCM, NAMA Facility, GCCI…).
  • Challenges in accessing and managing international climate finance.
  • Recommendations towards Vietnam’s climate fund readiness (Coordination, capacity building and enhancing finance).