Vietnam Carbon Market International Linkages | CDM, JCM, Paris Agreement
Can Vietnam connect carbon credits with the international market through mechanisms such as CDM, the Joint Crediting Mechanism with Japan (JCM), or Article 6 of the Paris Agreement?
Vietnam's carbon market framework is explicitly designed to integrate with international markets through several key mechanisms. The national system will not be a closed loop; instead, it is structured to recognize and facilitate the trading of carbon credits from multiple domestic and international sources. This approach is intended to ensure liquidity, attract climate finance, and align Vietnam with global standards.
The types of carbon credits expected to be traded on Vietnam's exchange include:
Domestically-generated credits
These are credits from programs and projects that are developed and verified according to Vietnam's own set of national carbon credit standards. This will foster a robust domestic pipeline of mitigation projects.
Credits from Cooperative Approaches under Article 6
The framework is being built to accommodate credits generated under the Paris Agreement. This includes "Internationally Transferred Mitigation Outcomes" (ITMOs) from bilateral agreements under Article 6.2 and credits from the new global carbon market established under Article 6.4. This is the primary pathway for future international linking.
Credits from Other International Mechanisms
The market will also recognize credits from established international cooperation mechanisms in which Vietnam participates. This includes legacy credits from the Clean Development Mechanism (CDM) and, significantly, credits from bilateral partnerships like the Joint Crediting Mechanism (JCM) between Vietnam and Japan.24
By allowing for this diverse range of credit types, Vietnam is positioning its market to be flexible and capable of seamlessly integrating with both regional and global carbon trading systems.
References
- Ministry of Foreign Affairs of Japan. (n.d.). Joint Crediting Mechanism (JCM). Ministry of Foreign Affairs of Japan. https://www.mofa.go.jp/ic/ch/page1we\_000105.html
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