European Investment Bank to continue helping Vietnam per Just Energy Transition Partnership

The European Investment Bank (EIB), the financing arm of the European Union, will further its cooperation with Vietnam, per the Just Energy Transition Partnership (JETP).

The EIB will deepen its collaboration on sustainable finance through technical assistance under the EIB’s Greening Financial Systems (GFS) program, an EIB delegation led by vice president Nicola Beer said at a Wednesday meeting with the State Bank of Vietnam (SBV).

Financed by the German Ministry for Economic Affairs and Climate Action (BMWK), the GFS program aims to help central banks and financial institutions to integrate climate risk into regulatory frameworks and promote private sector engagement in sustainable finance.

The SBV, the central bank of Vietnam, is expected to receive support to strengthen climate risk management, expand green finance, attract investment, adopt global best practices, and develop sustainable finance policies.

Through this partnership, the SBV will be empowered to strengthen the Vietnamese financial sector’s ability to support climate investments, the EIB added.

As part of its deepening engagement, the EIB is committed to establishing a €500 million framework loan with Vietnam’s Ministry of Finance to support the JETP implementation, the EIB clarified.

In 2023, the EIB signed an MoU to facilitate a multi-projects credit facility worth €500 million.

SBV Deputy Governor Nguyen Ngoc Canh highlighted the collaboration would support Vietnam’s Just Energy Transition Partnership (JETP) and aligns with the European Union’s Global Gateway priorities for sustainable finance and climate action.

Vietnam and the International Partners Group (IPG) comprising the EU, the UK, France, Germany, the U.S., Italy, Canada, Japan, Norway and Denmark signed the JETP in December 2022. Initial contributions to the JETP in Vietnam include $7.75 billion in pledges from the IPG together with the ADB and the IFC.

Vietnam is the third country to launch a JETP, following South Africa and Indonesia JETP. However, in March, the United States under the Trump administration revoked and rescinded the U.S. International Climate Finance Plan issued by the previous administration, including policies that were implemented to advance JETP.

As a result, the United States terminated its membership of the IPG for JETPs in South Africa, Indonesia and Vietnam.