On November 15, the International Finance Corporation (IFC) announced a record investment in Viet Nam for the 2024 fiscal year, focusing on climate finance to promote green transition and sustainable development.
According to IFC, the total new commitments aim to support Viet Nam's shift to a low-carbon economy while enhancing the adaptability and competitiveness of the private sector. Specifically, IFC's total commitments in Viet Nam exceeded $1.6 billion, including over $750 million in long-term investments. IFC directly committed $310 million from its funds for long-term investments. This represents IFC's highest-ever commitment to projects addressing climate change and ocean plastic waste in Viet Nam and the largest in the East Asia and Pacific region for this fiscal year.
IFC's investment and advisory programs in Viet Nam address critical development challenges, from food security and trade facilitation to boosting the manufacturing sector's competitiveness. As part of this, IFC provided $896 million in short-term funding for trade and value chain financing, supporting domestic businesses in promoting trade, production growth, and job creation.
IFC facilitated Viet Nam's first green bond issuance, including green bonds by the Southeast Asia Commercial Joint Stock Bank (SeABank), contributing to sustainable marine economy development and strengthening climate resilience. SeABank is also the first private bank in Vietnam to issue green bonds with IFC's support.
Additionally, IFC successfully connected $75 million in investment from the Asian Infrastructure Investment Bank (AIIB) to SeABank's green bonds. IFC also facilitated the issuance of Viet Nam's first sustainability-linked local-currency bonds by BIM Land and its subsidiary, Thanh Xuan, to promote sustainable tourism. Beyond financial investments, IFC has been supporting banks and businesses in establishing sustainable financial frameworks, laying the foundation for expanding climate-related investments.
IFC also assisted the State Bank of Viet Nam in issuing regulations on environmental risk management, creating a level playing field and helping domestic banks improve their management and mitigate financial risks related to environmental and climate factors. IFC further stated that it is working with development partners to build a green taxonomy system for Viet Nam to promote the "greening" of the banking sector.
Thomas Jacobs, IFC Country Manager for Viet Nam, Cambodia, and Laos, emphasized: "IFC's funding is a positive signal for the growth potential of Viet Nam's climate finance market. It encourages banks to explore this new segment while motivating manufacturers to align profitability with responsible investments, mobilize capital from sustainable financial markets, and support a low-carbon growth model."