Green bonds (GBs) are a fresh and applicable financial instrument introduced with the purpose of funding projects that have positive environmental or climate outcomes such as renewable energy or clean transport, waste management, building construction, water and land use.
In recent years, the development of GBs has shown that this is an effective investment channel for the purpose of protecting the environment.
Vietnam is an Asian economy that has been trying to establish and develop a GB market as a potential growth area.
A recent study conducted by a team of experts in the field examines the most important factors influencing development of the GB market in Vietnam using the analytic hierarchy process to analyse the opinions of experts.
“The results reveal that the most important influencing factors are the legal framework, monetary policies of Vietnam’s central bank, and the official interest rate of the green bonds.”
In other words, infrastructural and economic factors are the most important requirements to develop the current GB market in Viet Nam. These results formed a recommendation that the establishment of green regulations and green economic policies in the country would support the implementation of GBs in Vietnam.
The findings of this study have been published by the Asian Development Bank in a working paper (No. 1082, March 2020) titled, “Revisiting development of the green bond market: Evidence of the AHP approach”. The study sheds lights on the role that infrastructural and economic factors can play to develop green bond markets in Viet Nam and similar economies in the Asia Pacific region.
The paper is authored by Associate Professor Chuc Anh Tu (Academy of Finance, Vietnam), Associate Professor Tapan Sarker (Department of Business Strategy and Innovation, Griffith University) and Assistant Professor Ehsan Rasoulinezhad (Faculty of World Studies of the University of Tehran, Iran).