Standard Chartered sees further investment potential in 'green' Vietnam

What is the importance of the Vietnamese market in Standard Chartered’s ASEAN business strategy?

Vietnam is prioritized as a growth country for us. Last year, our Group CEO Bill Winters made his third official visit to Vietnam and this underscores Standard Chartered’s strong commitment to the market. Our CEO for Asia, Benjamin Hung, visited Vietnam in March of this year. The group sees the strong growth potential of Vietnam and has affirmed our continued investment in our local subsidiary.

A rising star in the region, the medium- to long-term prospects of Vietnam are bright. The favorable demographics of a young workforce, improving domestic fundamentals, as well as a strong commitment to integration with global markets and supply chains, are a focus for the country. Vietnam is determined to be an important player in international trade and global supply chains and solidify its role as an alternative manufacturing hub, another factory of the world.

The progressive government is committed to improving the business environment for continued FDI in the country. As an international bank and the only bank that is present in all 10 ASEAN markets, we are best placed to provide our clients with onshore expertise and with global products and services to expand their businesses in this vibrant market.

For our consumer business, the growing emerging affluent population who are now ready to partner with our bank is growing day by day. We are excited to be able to further educate, work with and grow with our clients. Our commitment to Vietnam is to work with the Vietnamese government, our clients, partners and alliances to accelerate the net-zero process, enhance participation in the community of Vietnam, and support corporate globalization. That’s why Vietnam is prioritized as a growth country for us.

The government of Vietnam is seeking to reach carbon neutrality by 2050. “Here for good” is Standard Chartered’s brand promise worldwide. What are the bank’s plans and moves to support the Vietnamese net-zero target?

Our desire to be a catalyst for socio-economic development sits at the heart of our business strategy and is reflected in our brand promise, “Here for good”. As of June 30, 2022, Standard Chartered Vietnam reported outstanding sustainable finance exposures of $52 million supporting renewable energy assets, which has led to over 40 tons of CO2 saved in the last year, and $51 million supporting SME financing.

Standard Chartered Vietnam and our global network also partner with local banks to finance renewable energy projects’ equipment and we continue to be a strong supporter of the country’s energy transition ambitions. As a firm, we have committed to mobilizing $300 billion by 2030 in green and transition financing and have set up a transition acceleration team to support carbon-intensive sectors.

In 2020, we were honored to partner with the Vietnamese government at COP26 where Prime Minister Pham Minh Chinh committed to net-zero for Vietnam, then again at COP27 with the Glasgow Financial Alliance for net zero (GFANZ) banks and Vietnamese leaders to continue the process of delivering climate action and fair transition.

We believe that education is also a very important component of the net-zero transition. We partnered with the British Chamber of Commerce for a “sustainable” series for all British and local companies’ networks. Just in March of this year, we partnered with Vietnamese company “Dear Our Community” featuring social impact practitioners targeting young audiences in Vietnam on sustainability aspects and career paths. Our client conversations and making “green” their business and their supply chain are something that we have embraced since many years ago.

Standard Chartered Bank Vietnam will continue to support and build on the Vietnamese government’s ambition and success from COP26. It will be an exciting journey for all of us in Vietnam as we work together on all facets of the net-zero journey - government and private sector - to execute the different verticals of work under the Just Energy Transition Partnership (JETP) to deliver our collective ambitions to reach net-zero emissions by 2050.

As Vietnam is an export-driven economy, Vietnamese exporters are in critical need of funding for their businesses. How can Standard Chartered support them in trade financing and in getting access to global supply chains?

Vietnam has set an objective of becoming a high-income economy by 2045 and a carbon-neutral economy by 2050. Financing is a key enabler to achieving these ambitious targets, and the role of financial institutions as financing parties is critically important. This is where financial institutions like Standard Chartered can offer support under clear and global policy guidelines facilitating sustainable financing to flow in Vietnam.

Olea, a digital supply chain platform, a joint venture between Standard Chartered and leading supply chain technology provider Linklogis, has recently announced its entry into Vietnam to offer trade finance solutions. With the power of digitalization, we can help our clients achieve their growth ambitions.

The world is increasingly demanding more green elements in products and services. What should Vietnamese enterprises do to better adapt to the trend, in your opinion?

Businesses here should focus on accelerating green transformation and moving up the value chain to contribute to Vietnam’s sustainable growth.

There is an element of government support and clear guidelines, laws and regulations to speed up the transition across many sectors. We also encourage Vietnamese enterprises not to look at transition as optional, instead, to balance between the tactical and medium- and long-term success of their enterprises as the world trend is increasingly demanding products and services which are green.

By investing in sustainable products and services and adopting new technologies, businesses can improve resource efficiency and reduce waste. A framework is needed to clearly define what can be green and we can provide the right financing solution. At Standard Chartered, we work with clients to be able to structure their businesses and supply chains or future products to be greenable.

This is part of our strong commitment to meeting clients’ rising sustainability aspirations with innovative sustainable finance solutions. We are dedicated to contributing to the sustainable development of Vietnam and continue working closely with our clients and stakeholders to provide finance where it matters the most.

Does Standard Chartered have any investment expansion plans for Vietnam?

Vietnam remains a key growth market for Standard Chartered and we will continue to invest in Vietnam to drive commerce and prosperity. Standard Chartered has stepped up our investment in Vietnam over the past few years. In August 2021, we made the third capital increase within three years by injecting an additional $120 million of capital into the Vietnam franchise.

We have invested over $5 million in community projects ranging from “girls' clubs” in secondary schools to entrepreneurship in the community and will continue to do so. Education as I mentioned earlier is so critical for sustainable growth. Technology and digitization is also a focus area for us. We see SMART 4.0 Vietnam as an ongoing opportunity for Standard Chartered Bank Vietnam to continue to invest in as well as in the community that we serve.

We are committed to being agile and adapting to the developments of Vietnam and will appropriately support the ambitions of the country and the growing emerging affluent population where they align with our own business commitments and strategies.