Vietnamese enterprises must prepare in advance for CBAM: experts

The European Union (EU)’s Carbon Border Adjustment Mechanism (CBAM), which is set to take effect in 2024, will impact production and trade activities of Vietnamese manufacturers, especially in high carbon emission industries like iron and steel, aluminium and cement, as well as the whole economy, said experts.
Hanoi (VNS/VNA) - The European Union (EU)’s Carbon Border AdjustmentMechanism (CBAM), which is set to take effect in 2024, will impact productionand trade activities of Vietnamese manufacturers, especially in high carbonemission industries like iron and steel, aluminium and cement, as well as thewhole economy, said experts.

The mechanism, just updated by the EU and the European Parliament (PE) thisFebruary, is created to make a fair playing field for European businessesfacing carbon prices by imposing a carbon border tax on imports from countriesthat do not apply equivalent carbon pricing measures.

CBAM will directly affect Vietnamese products and exporters to the EU, saidSirpa Jarvenpaa, Director of Southeast Asia Energy Transition Partnership(ETP), adding that exporters will have to ensure that products exported to theEU meet a corresponding tax rate as EU manufacturers are imposed.

“CBAM has a crucial meaning to Vietnam as the country is a major exporter tothe EU,” Jarvenpaa said.

“The results of the impact assessment of the CBAM at this workshop provide acomprehensive view of the difficulties and policies affecting Vietnam and howCBAM contributes to the energy transition to help Vietnam reduce carbonemissions.”

"It also shows the difficulties due to the technical complexity indetermining the carbon tax rate in Vietnam.”

CBAM will initially apply to imported goods such as steel, cement, fertiliser,aluminium, electricity and hydrogen. They are sectors with a high risk ofcarbon leakage and high carbon emissions, accounting for 94% of the EU'sindustrial emissions.

All 27 EU member countries are expected to begin piloting CBAM in October.

Reducing greenhouse gas emissions is now a trend and a requirement thatbusinesses must follow if Vietnam wants to compete in the internationalplayground.

In research published at the consultation workshop, Vietnam’s steel industrysuffers the most from CBAM, followed by the aluminium sector.

According to the research, steel production is estimated to drop 0.8% in 2030under the effect of CBAM, while export value decreased by 2.3%. In thealuminium industry, the output is estimated to fall by 0.4%, and the exportvalue will be down 4.3% in 2030.

Many surveyed businesses currently do not see CBAM as a threat, but the impactwill be significant if the mechanism is expanded.

Even though many countries like the US and Japan showed mixed reactions towardCBAM, they are considering their regulations and raising the need to accelerateglobal decarbonisation.

Therefore, early preparation for CBAM is necessary, said Do Nam Thang, apolitical expert from Applied Economic Modelling and Data Analysis.

“CBAM is evolving with many uncertainties, its impacts may grow fast, and weshould take early prepare for them," Thang said. "The mechanism willaffect enterprises and the country's competitiveness in global markets.”/.
VNA

See more

National Highway 61C (Photo; baohaugiang.com.vn)

Hau Giang, JICA to upgrade national highway

National Highway 61C linking Can Tho city with Hau Giang province will feature four lanes for motor vehicles and two for non-motorized traffic, with an estimated cost of over 5.17 trillion VND (206.8 million USD).

At the ceremony (Photo: nhandan.vn)

Ha Nam grants investment certificates for two key projects

Ha Nam province on February 13 licenced the high-precision circuit board manufacturing plant of Red Board Technology (Vietnam) Co., Ltd., and the kitchenware and related metal products manufacturing plant of Casla Kitchenware JSC.

A total of 18,893 cars were sold in Vietnam in January, a drop of 40% compared to the previous month (Photo: VietnamPlus)

Car sales in Vietnam down 40% in January

Experts attributed a sharp decline in car sales to the Lunar New Year (Tet) holidays, impacting consumers' purchasing power. Consumers tend to wait for new models and releases at this time of year, contributing to lower sales during this period.

Illustrative image (Photo: VNA)

Retail fuel prices in latest adjustment

According to the new pricing, E5 RON92 bio-fuel is now priced at 20,598 VND per litre, up 156 VND, while RON95-III costs 21,074 VND per litre, an increase of 146 VND.

NA Chairman Tran Thanh Man speaks at the session on February 13. (Photo: VNA)

NA weighs new policies to boost science, technology, innovation

The resolution, presented at the February 13 session of the NA Standing Committee, seeks to establish a legal framework that would effectively boost national scientific-technological advancement and digital transformation, making them driving forces for socio-economic development to deliver on the dual targets by 2030 and 2045 as outlined at the 13th National Party Congress.

CPI in January 2025 rose by 0.98% compared to December 2024 (Photo: thoibaotaichinhvietnam.com)

Fiscal, monetary policies support demand stimulation, price stabilisation

These efforts, in conjunction with the implementation of monetary policies and other macroeconomic policies, aim to solve difficulties for businesses and the public, stabilise the macroeconomy, control inflation, ensure the balance of the economy, promote economic growth, and secure social welfare and people's livelihoods.

People line up to register for land auctions in Hoai Duc district, Hanoi. (Photo: VNA)

Affordable housing for young buyers a win-win: HoREA

Most young people are ambitious and have a long career path ahead of them to generate income and repay loans. Typically, within 10-15 years, their earnings will double or triple, making such loans low-risk for banks, said HoREA