Vietnam to sign ERPA with the World Bank

According to the plan, on October 22, 2020, the Ministry of Agriculture and Rural Development (MARD) and the World Bank (WB) - the trustee agency of the Forest Carbon Partnership Facility (FCPF) - will sign the Emission Reduction Purchase Agreement (ERPA) in Viet Nam’s North Central region.

According to this agreement, Vietnam will transfer to FCPF 10.3 million tons of CO2 emission reduction from forests in 6 North Central provinces of Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri and Thua Thien - Hue for the period 2018 - 2024. FCPF will pay US$ 51.5 million for this service, of which US$ 15 million is expected in 2021; US$ 20 million in 2023 and US$ 16.5 million in 2025.

Vietnam is a member of the United Nations Framework Convention on Climate Change. According to Permanent Deputy Minister of Agriculture and Rural Development Ha Cong Tuan, Vietnam has committed to reduce greenhouse gas emissions by 8% by 2030 compared to 2015 (by itself). With effective cooperation from other organizations and countries, Vietnam will commit to reducing greenhouse gas emissions by up to 25% by 2030 compared to 2015.

The Forest Carbon Partnership Facility (FCPF) was founded by the United Nations. In 2018, the FCPF recognized that Vietnam had basically been ready to start reducing emissions from deforestation and forest degradation (REED +). Vietnam’s efforts to implement REED + were highly appreciated internationally with its National Program on REED + implementation, legalizing this issue in the Law on Forestry 2017.

In 2018, MARD and the FCPF signed a protocol that Vietnam will be the first country to implement the payment of FCPF based on the results it achieved.

According to Ha Cong Tuan, the signing of ERPA benefits Vietnam a lot.

Firstly, it shows Vietnam’s determination to reduce deforestation and forest degradation. Along with that is the efforts to decide on the price of greenhouse gas emission reduction, which is recognized by the international community.

Secondly, the signing of the ERPA will promptly replenish new and stable financial resources to support the protection and development of forests, especially in 6 North Central provinces.

If Vietnam fulfills this commitment, from now to 2025, the 6 North Central provinces will reduce 10.3 million tons of CO2 emissions, and the FCPF will pay about US$ 51.5 million. This is a very meaningful resource for the central provinces. Together with other UN pilot projects, it serves to reduce greenhouse gas emissions, and to enforce the carbon credit market across the globe.

With the ERPA, Vietnam will be the fifth country in the world to sign an agreement with the FCPF, and the first country in the Asia-Pacific to sign this agreement. This affirms Vietnam’s international reputation and helps Vietnam a lot in implementing the payment of carbon services legally.