The Ministry of Agriculture and Rural Development sold carbon credits obtained from forests in the North Central region to the International Bank for Reconstruction and Development (IBRD) of the World Bank. This was part of an agreement to reduce greenhouse emissions.
As part of the agreement, 10.3 million tons of CO2 were transferred to the World Bank and sold for 51.5 million USD. The Ministry received an initial payment of 41.2 million USD in August, which is 80% of the emission reduction results according to the agreement. The remaining payment of 10.3 million USD will be paid after completing the transfer of 10.3 million tons of CO2.
The Ministry plans to use the funds to pay forest owners, local People’s Committees, and organizations assigned to manage natural forests. In addition, part of the money will be spent on activities related to development and reducing deforestation, forest degradation, increasing income, and improving livelihoods for people working in this field.
The Vietnam Forest Protection and Development Fund will be responsible for receiving, managing, and using funds from the agreement and coordinating with the Forest Protection and Development Fund of six provinces in the North Central region.
The World Bank confirmed that the emission reduction results of the entire North Central region in the first period (January 1, 2018 – December 31, 2019) reached 16.21 million tons of CO2 (equivalent to 16.21 million credits). Forest carbon credits are generated from project activities that reduce greenhouse emissions such as reducing deforestation, forest degradation, enhancing afforestation, reforestation, vegetation regeneration, and forest management enhancement activities.
Forest owners can convert the forest area under management and protection into the amount of CO2 absorbed, into carbon credits, which can be sold in the carbon market through the greenhouse gas emission reduction mechanism. With the sale of carbon credits, the Ministry can provide incentives for forest owners to manage and protect the forests more effectively while promoting sustainable development of the region.
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Source: Vietnam Insider