Vietnam should spend $368 billion through 2040 to mitigate and adapt to climate change while advancing its development goals, according to a report from the World Bank.
The southeast Asian country, with a population of about 100 million, is one of the world’s most vulnerable nations to extreme weather events and rising sea levels.
Without taking the proper adaption and mitigation measures, investing approximately 6.8% of its annual gross domestic product, climate change could cost Vietnam as much as 14.5% of its GDP by 2050, according to the analysis released Thursday.
“Vietnam should embrace a new development paradigm based on two connected pathways—to adapt to climate change and build resilience, and to mitigate climate change by decarbonizing growth and steering the economy away from carbon-intensive energy,” the report said.
If it follows that path, Vietnam can achieve its climate objectives while expanding its GDP per capita by more than 5% a year, the report said. The public and private investments needed must also be accompanied by structural and policy reforms including a carbon pricing mechanism and other reforms.
“Vietnam cannot be timid on climate change. It must act, and it must act boldly,” said Darryl J. Dong, acting country manager for Vietnam at the International Finance Corporation, the private sector arm of the World Bank Group.
{{/usCountry}}“Vietnam cannot be timid on climate change. It must act, and it must act boldly,” said Darryl J. Dong, acting country manager for Vietnam at the International Finance Corporation, the private sector arm of the World Bank Group.
{{/usCountry}}Dong spoke at the Hanoi conference to release the report Thursday.
“Adaptation and mitigation will not be easy, will not be cheap, and the reality is there no choice,” Dong said. “Major financing is needed.”Dong said the World Bank Group’s Vietnam Country Climate and Development Report estimates that $370 billion will be needed through to 2040 for Vietnam to prepare for climate change. It will be impossible for Vietnam to fund this alone, he said, and the private sector will be needed to commit at least half. “Private sector financing will be key,” he said.