On 30 May 2024, EuroCham Sustainable Finance Sector Committee (SFSC), in collaboration with BNP Paribas, organised the first policy dialogue on sustainable trade finance. The roundtable offered an engaging platform for 40 leaders and experts representing a diverse mix of institutions, including International Finance Corporation (IFC), Asian Development Bank (AFB), Mitsubishi UFJ Financial Group (MUFG), United Overseas Bank (UOB), Bangkok Bank, Techcombank, Agribank, BIDV, as well as manufacturing, construction, logistics, agriculture businesses and consulting firms. 

Opening the event, EuroCham’s SFSC Chairman, Giando Zappia cited the figures from WTO and IFC highlighting the following: (i) 80% of international trade activities rely on trade finance; (ii) the 5 Vietnamese largest banks account for over 50% of the trade finance market (i.e. 150 billion USD); (iii) only 29% of banks in Vietnam provided trade finance to climate-related activities.. 

The event welcomed introductions and sharing from IFC representatives, Ms. Nathalie Louat – Director of Global Trade and Supply Chain Department and Ms. Ilona Morar – Climate Business & Sustainability, Financial Institutions Group. Following the remarks, Ms. Ilona Morar shared perspectives on sustainable trade in relation to the goals of the Paris Agreement. They also mentioned ongoing efforts to provide clearer guidelines and reference notes to support businesses in defining and promoting green trade and trade finance. 

Mr. Nguyen Le Thang Long, president of An Phat Bioplastics continued the session by sharing from the perspectives of a manufacturer who had export activities to the European market, which is also a pioneer in terms of sustainability-related regulations. Mr. Long highlighted the need to invest in activities such as R&D and certifications which may incur costs and seek support from sustainable trade, as well as the need for strong government support and practical policies. 

Standing from the position of a leading bank in sustainability, Mr. Eric Tran – Head of Sustainability, Transaction Banking APAC of BNP Paribas CIB, shared that BNP Paribas has been integrating ESG in their risk management and also suggested supporting enterprises in their transition journey with a suite of services, ranging from aligning financing and investments with sustainability agenda including sustainability-linked trade finance, to green and sustainable assets/projects financing, and so on. 

The final presentation was given by Mr. Nguyen Minh Tu – Managing Director, Business Information, FiinGroup, which explored “The Rise of Potentially Eco-sensitive Enterprises in Vietnam’s Trade Landscape”. According to him, even though the export and import values of eco-sensitive products experienced fluctuations in recent years, in general, it shows a growing trend in both importance and volume in Vietnam’s trade activities. The export, import value of such products peaked at 148 billion USD in 2021, equivalent to 26% of the total trade value. He also highlighted that out of 8,400 eco-sensitive enterprises analysed, 61% are SMEs, which generally have higher risk profiles compared to more stable situations of large companies and micro-SMEs. 

Following the introductions by the 5 distinguished speakers, participants actively engaged in an open discussion session revolving around green finance practices, relevant legal regulations including Carbon Border Adjustment Mechanism (CBAM), EU Deforestation Regulation (EUDR), and the green taxonomy. Many participants agree that strong government support would be key to promoting green transition and green trade in Vietnam. 

The EuroCham Sustainable Finance Sector Committee (SFSC) invites all stakeholders passionate about advancing green trade and finance to join our efforts. Together, we can forge a sustainable path forward, influencing policies and practices to support Vietnam’s green transition. Join us in shaping a resilient and environmentally responsible trade ecosystem.
 

🌱 Want to join SFSC in driving sustainable trade and finance. Contact Ms. Ngoc Anh anh.pham@eurochamvn.org