Failure to meet "green" standards, businesses may not be able to export goods

Mr. Vu Ba Phu, Director of Trade Promotion Department - Ministry of Industry and Trade.

More countries are interested in developing a green and sustainable economy, how does this affect consumption trends in these countries, sir?

Globally, and especially in Europe, green and clean consumption has become an official trend, not a niche market as before. Previously, green and sustainable standards were only seen in high-end segments, but now they have become common requirements in all segments and markets.

It is clear from EU laws banning all imports related to deforestation, regulations on legal fishing in fisheries, promotion of green products, emission reduction and most recently, sustainability reporting regulations for European businesses were issued on November 10, 2022 to ensure transparency, clearly define responsibilities for stakeholders across the supply chain into the market.

It can be seen that the frequency of issuing legal regulations to promote green growth is increasingly dense, in accordance with the spirit of the Green Agreement.

Thus, green growth, green development, and circular economy are becoming global trends and are practiced fiercely in the most developed economies in the world such as the European market. Because, this has been confirmed as a solution to reduce greenhouse gas emissions, toward a carbon-neutral economy in the long term.

What challenges does this new trend pose for Vietnamese businesses?

For products of existing categories, a major risk is that they cannot be exported to markets that are raising green standards if they do not meet the standards. The market for certified products has skyrocketed in the last 15 years and if Vietnamese exporters don't have the certifications required by green-standard markets or customers with green standards.

Next year Vietnam and many enterprises will not be able to export goods. Therefore, it is necessary to meet these green standards quickly to gain a competitive advantage, before other exporting countries get ahead.

In such a context, how can we quickly meet green standards to gain a competitive advantage before other exporting countries take the lead?

It should be affirmed that green growth is the hedging strategy of both the public and private sectors. Because green growth reflects how economies respond to the complex developments of climate change and the depletion of natural resources; reflects trends in search of new growth models with green industries as the spearhead, creating new growth engines and being highly competitive.

I think from the perspective that the units that have the closest and earliest access to brands, buyers, and trade promotion agencies will have the most accurate information to coordinate and transfer these signals and requests to management units and domestic enterprises.

From there, it is possible to jointly develop a set of green standards to help guide Vietnam's exports to promptly respond to the new requirements of the market. The trade promotion system must support so that industries and Vietnam, in general, are more active, in a position of mastery, and self-develop green standards that are recognized by the world market and customers.

However, it is necessary to review the domestic trade promotion network, which has some limitations, not really meeting the mission of providing a "special" service because of many difficulties and challenges both internally and externally.

The majority of corporate customers are small enterprises, only a few enterprises are really medium-sized, especially in the areas of agriculture, forestry and fishery.

Enterprises can hardly invest in market research and marketing activities themselves. But it is also necessary to recognize that there is still a lot of psychological dependence, waiting for help from subsidized thinking, so paying for services is still very limited.

Meanwhile, according to the public service function with support from the state budget, due to the perception of commercial promotion function services, there are differences between localities, so the organizational model and organizational method are not synchronized and not stable. Many localities have not paid attention, leading to inadequate investment resources.

So, what solutions are needed?

First of all, it is necessary to quickly raise awareness of all levels of sectors and the whole society about the green transformation that is taking place very strongly; they must have a specific strategy to be able to position Vietnam as the "green supply" of the world.

Along with that, it is necessary to form a legal system on green standards in production, supply chain and trade, with priority given to the circular economy; deploying new business models, applying digital technology, developing new products, environmental products and goods; enhancing products that help reduce carbonization.

At the same time, it is necessary to develop policies and support mechanisms for green transformation.

In particular, trade promotion plays a very important role in helping to orient the economy to connect with the global economy. Therefore, it is necessary to strengthen the coordination of the trade promotion industry with specialized agencies to synchronize solutions to raise awareness of the whole society; provide technical support for compliance and meeting green standards; promulgate legal regulations suitable to the development level of the economy on green standards.

At the same time, this agency will promote policies and mechanisms to support the transition to green production and trade.

From the Department of Trade Promotion, we will also supplement and coordinate with international organizations, projects, and programs to improve internal capacity for promotion and support staff and apply digital transformation tools by expanding and integrating centers into the digital trade promotion ecosystem.

We will also apply and supplement tools to continuously improve internal capacity as well as the whole network with digital tools.