What incentives are available to businesses that participate in circular economy development trials?

DNHN - The Ministry of Planning and Investment is seeking feedback on the proposed Circular Economy Development Pilot Mechanism Decree. Enterprises participating in the pilot mechanism will have access to numerous consulting and transfer policies

To promote sustainable development and circular economy within the nation, the Ministry of Planning and Investment has just released a draught policy on technology consulting and technology transfer. According to this proposal, businesses that participate in the testing mechanism for the circular economy will receive a 50% subsidy for technology consultants.

According to the draught Decree on the pilot mechanism for circular economic development, businesses participating in the pilot mechanism will be eligible for a variety of preferential policies on consulting, technology transfer, green credit policies, and green bonds, which will support human resource development and land policy.

Circular economy projects participating in the testing mechanism will be supported by the state and local authorities by introducing technology as well as financial support. Specifically, businesses participating in the testing mechanism will be exempt from import tax on technological equipment used for the project, and they will also be given priority in customs clearance.

In addition, the government commits to assisting businesses with up to 50 per cent of the cost of renting or purchasing digital transformation solutions to implement circular economy projects.

Policy on Green Credit and Green Bonds

In addition, the proposal suggests establishing green credit and green bond policies to support circular economy projects.

According to the proposal, projects participating in the pilot mechanism will be issued a certificate of registration allowing them access to preferential loans from credit institutions and foreign bank branches. international financial institutions, the Vietnam Development Bank, provincial development investment funds, social security funds, environmental funds, green development funds, and financial institutions and enterprise science and technology development funds.

In addition, projects are urged to collaborate with functional units to issue green bonds by bond law provisions. Each province and municipality is limited to a maximum of five organisations permitted to issue green bonds through the pilot programme. Additionally, only one unit is permitted to collaborate with the local development investment fund to operate the green bond trading floor, per the proposal.

The term of green bonds, the period of trial operation of green bond trading floors, and voluntary carbon credits do not exceed the term of the project registering to participate in the testing mechanism unless there are new regulations other than those at the level of National Assembly Laws and Resolutions.

Contribute to human resource development

In support of human resource development, the draught policy specifies that the State will pay up to 70 per cent of the total cost of a course in business administration for organisations that participate in the testing mechanism.

In addition, the State will cover 50 per cent of vocational training and career change costs for each worker in the area implementing the circular economy project, not to exceed three months' base salary. Participate in the evaluation process. Participating organisations in the testing mechanism will compile a list of employees who require vocational training or a career change and submit it for approval to the unit responsible for revoking the certificate of registration to participate in the testing mechanism.

State and local authorities are also obligated to link labour supply units, vocational schools, secondary schools, colleges, and universities with organisations participating in the testing mechanism to ensure that the labour source meets the required number, quality, and quantity for implementing circular economy projects.

Phuong Dang