Vietnam - A Priority Partner in Europe's "Global Gateway"

3:33:17 PM | 6/10/2024

Energy transition is a core and promising content for Vietnam, according to Myriam Ferran, Deputy Director General at the European Commission Directorate General for International Partnerships.

Sharing with the press recently, Ms. Myriam Ferran, Deputy Director General at the European Commission Directorate General for International Partnerships, mentioned the EU's Global Gateway Strategy on green and sustainable investment, in which Vietnam is one of the top priority partners.

Priority partner

This strategy promotes investments to address global challenges such as climate change response, green transition, digital transformation, sustainable transport, promoting human resources such as education, health care, ensuring fairness and bringing benefits to people.

According to Ms. Myriam, energy is the core topic of discussion during this working trip to Vietnam, aiming to help ensure that Vietnam achieves its goal of net zero emissions by 2050, moving towards efficient use of renewable energy.

Non-refundable aid contributions are the top choice for these goals. Accordingly, the EU is promoting the signing of a funding agreement equivalent to €500 million for Vietnam within the framework of the Just Energy Transition Partnership (JETP), implemented through the French Development Agency (AFD).

Climate change is a global challenge and the EU is implementing these contents not only internally but also bilaterally. At the recent EU-ASEAN Summit, the EU committed 10 billion Euros to implement contents related to the European Green Deal, Ms. Myriam Ferran noted. "Vietnam is a key partner in the Global Gateway strategy in the region and ASEAN," she said.

Explaining this, Ms. Myriam Ferran said that Vietnam is an important partner with the fastest growth rate in the world. Along with that, the demand for developing energy consumption and emissions will increase accordingly.

Specific projects

Also within the framework of the visit, the Deputy Director General at the European Commission Directorate General for International Partnerships will also visit Ninh Thuan province to visit vocational education projects, climate change response projects on irrigation and water resources, and digital skills improvement.

Ms. Myriam mentioned the Bac Ai pumped storage hydropower plant - the first project of this type in Vietnam with the support of the EU - a symbol of cooperation on green transition and energy between the two sides.

Ms. Myriam also affirmed that the field of sustainable and green transport is certainly a priority in the global cooperation development strategy. The expansion of the second phase of the urban railway line No. 3 in Hanoi has the support of the EU's pre-feasibility study implemented by AFD.

According to information from the Vietnamese and EU ministries and agencies, they are discussing how to implement specific projects within the framework of the Global Gateway. Among them, we can mention the TVET project on digital skills training with a funding source of €54 million implemented in 30 localities in Vietnam.

Non-refundable financing is executed via a blended finance mechanism, which bolsters loans and interest rates for substantial projects such as hydropower, thereby mobilizing supplementary capital from the private sector to augment public funding. For instance, during the 2021-2024 period, the European Union has pledged to provide non-refundable aid amounting to €210 million to Vietnam. While this figure may appear modest, it plays an important role in generating significant leverage to attract a considerably larger pool of total capital, according to Ms. Myriam Ferran.

In the field of energy transition alone, the EU has committed ODA equivalent to €140 million to Vietnam, through projects on legal reform, improving the quality of staff capacity, investing in related infrastructure, etc.

Vietnam needs to take advantage of "dual transition"

According to Ms. Myriam Ferran, energy transition is a core component in Vietnam's development process. This is a process that "must take place”. “Although it is difficult, this is a promising direction for Vietnam," emphasized Ms. Myriam Ferran.

The EU recommends that Vietnam needs to implement "dual transition", promoting digital transformation and energy transition at the same time.

"Digital transformation helps the transition to clean energy at affordable prices. They need to go hand in hand to create mutual support to realize Vietnam's development goals," said Ms. Myriam Ferran.

Binh Minh ((Vietnam Business Forum)