The Rise of Green Investments: Opportunities for Sustainable Investment in Vietnam

With sustainability on the rise, Vietnam is positioning itself as a major green investment hub, through strong government support programs and corporate incentives. From renewable energy to sustainable agriculture, this article explores key opportunities for setting up your sustainable investments in Vietnam.

What is A Sustainable Investment in Vietnam?

Sustainable investment integrates environmental, social, and governance (ESG) factors into financial decisions, creating long-term value while minimizing negative impacts. In Vietnam, it plays a crucial role in balancing economic growth with sustainability by ensuring resource efficiency and climate resilience.

As Vietnam accelerates its economic growth, several industries are popular sources for sustainable investments. Below you’ll find the most prominent industries within the sustainability sector, which are driven by government initiatives, environmental concerns, and evolving consumer preferences:

1. Renewable Energy: Vietnam has a renewable energy potential of 160 gigawatts, with a government goal to reach 30% renewables by 2030. This creates opportunities in clean energy projects, infrastructure, and technology.
2. Sustainable Agriculture: With rising demand for organic farming and eco-friendly practices, Vietnam’s organic fertilizers market is set to grow at a 6.7% CAGR. This creates opportunities in organic food production, precision farming, and agri-tech innovations.
3. Green Real Estate and Construction: Amid rapid urbanization, Vietnam is expanding green building initiatives, with over 250 LEED-certified buildings by 2023, creating opportunities in eco-friendly materials, smart cities, and sustainable infrastructure.
4. Eco-Friendly Transportation: Vietnam is transforming its transportation sector with low-emission solutions, creating investment opportunities in EVs, green public transit, and smart mobility to support its 2050 carbon neutrality goals.
5. Eco-Tourism: The country’s rich landscapes and cultural heritage make it a prime destination for eco-tourism, offering investment opportunities in sustainable resorts, adventure tourism, and conservation-focused travel.
6. Circular Economy and Waste Management: Vietnam’s focus on a circular economy is driving growth in waste-to-energy, recycling, and sustainable packaging, creating lucrative opportunities for investors in eco-friendly innovations.

Why Invest in The Sustainable Sector of Vietnam?

Government Initiatives Supporting Green Investments

The country has implemented comprehensive policies and initiatives to attract and support green investments. These policies create a favorable environment for entering the country’s green economy, offering financial incentives, regulatory support, and long-term sustainability benefits:

• National Green Growth Strategy: A roadmap for sustainable development, focusing on carbon reduction, renewable energy expansion, and eco-friendly industries.
• Vietnam-GGGI Country Planning Framework (CPF): A partnership with the Global Green Growth Institute (GGGI) to promote low-carbon development and green financing.
• National Carbon Market: Vietnam plans to launch a mandatory domestic carbon market, with a pilot phase between 2025 and 2027 and full operation by 2028, creating new investment opportunities in carbon credit trading.
• Green Investments: GGGI has helped mobilize $410 million for projects like waste-to-energy plants and green bond issuance, fostering large-scale sustainability initiatives.
• Land Rent Reductions: The Ministry of Finance has proposed a 30% reduction in land rental fees for green businesses. This eases financial burdens in manufacturing, logistics, and renewable energy sectors.
• Green Building Subsidies: The government provides financial support for energy-efficient construction, including subsidies for solar panels and sustainable building materials.

Incentives and Benefits for Setting Up A Sustainable Investment in Vietnam

The Vietnamese government also actively supports sustainable investments through strategic incentives designed to attract foreign and domestic investors. Businesses engaging in sustainability projects can benefit from several benefits to ensure the sector’s growth and economic stability:

• Tax Incentives and Exemptions: The Vietnamese government provides various tax benefits for green projects, including:
  • Corporate Income Tax (CIT) Reduction: Preferential CIT rates (as low as 10% for 15 years) and tax holidays for renewable energy, waste treatment, and eco-friendly projects.
  • Value-Added Tax (VAT) Incentives: Reduced VAT rates or exemptions for environmentally friendly products and services.
  • Import Tax Exemptions: Exemptions on imported equipment and materials used in renewable energy and sustainability projects.
• Preferential Loans and Grants: Investors in sustainability initiatives can access low-interest loans and grants through Vietnam’s Green Credit Programs. This is supported by both domestic banks and international financial institutions. Funds are available for projects in renewable energy, energy efficiency, and green manufacturing.
• Public-Private Partnership (PPP) Opportunities: The government actively promotes PPP models to attract foreign investors into sustainable infrastructure, smart cities, and green transportation projects. These partnerships help reduce investment risks while benefiting from government-backed incentives.
• Market Advantages: Vietnam’s growing consumer demand for green products and services presents strong market potential. Consumers and businesses are increasingly prioritizing sustainability, creating opportunities for eco-friendly brands, clean energy solutions, and circular economy innovations.

Emerhub can help you identify potential incentives for sustainable investments in Vietnam by assessing your planned operations and matching you with available tax breaks, grants, and government support programs. With our expertise in local regulations and industry-specific incentives, we are here to guide you in maximizing benefits while ensuring compliance with Vietnam’s sustainability policies.

How to Set Up A Sustainable Investment in Vietnam 

Accepted Types of Investments for Vietnam’s Green Sectors

Multiple avenues allow you to capitalize on Vietnam’s green transition while contributing to long-term environmental and economic sustainability. These key investment options include:

• Direct Foreign Investment (FDI): Establishing or expanding businesses in renewable energy, sustainable agriculture, eco-friendly manufacturing, and waste management.
• Mergers and Acquisitions (M&A): Acquiring or partnering with local sustainable enterprises to leverage market expertise and regulatory advantages.
• Green Bonds and ESG-Focused Funds: Investing in government or corporate-issued green bonds and Environmental, Social, and Governance (ESG) funds that support eco-friendly projects.
• Venture Capital and Impact Investing: Funding green startups focused on clean energy, sustainable technology, and circular economy solutions.
• Public-Private Partnerships (PPP): Collaborating with government and private entities to develop sustainable infrastructure, green urban projects, and eco-transport initiatives.

Overview of Vietnam’s Foreign Investment Regulations

While most green investments are encouraged, certain sectors remain restricted for foreigners. This includes those tied to national security, public health, and resources like mining and forestry. Some industries, like waste management, may also require special approvals or local partnerships. Typically, you can establish your company through several business structures:

• 100% Foreign-Owned Limited Liability Company: Allows full ownership and control, commonly used in sectors like renewable energy and sustainable manufacturing.
• Joint Ventures (JV): A partnership between a foreign investor and a local entity. Often required in restricted sectors or used to leverage local market expertise.
• Public-Private Partnerships (PPP): A government-backed collaboration model for infrastructure and sustainability projects, such as green urban development and eco-transport.

How to Set Up A Green Investment Company in Vietnam

Launching a sustainable investment in Vietnam requires careful planning, from choosing the right business structure to securing environmental approvals. You must register your company, obtain sector-specific permits for renewable energy or sustainable projects, and comply with Vietnam’s environmental regulations.

Emerhub provides comprehensive support to help you establish your green investment company, offering services such as:

• Company Registration: Handling business incorporation, legal entity setup, and structuring.
• Licensing & Permits: Securing necessary approvals for sustainable projects, including investment licenses and environmental permits.
• Tax Incentive Applications: Assisting in applying for tax breaks, exemptions, and preferential treatment for green investments.
• Environmental Impact Assessment (EIA): Conducting EIAs to ensure compliance with Vietnam’s environmental regulations.
• Securing Land & Facilities: Assisting in identifying suitable locations, leasing or purchasing land, and obtaining necessary land-use rights.

Want to set up a sustainable investment in Vietnam? Fill out the form below to get in touch with one of our local experts!