Chapter 17

The Circular Economy

in Viet Nam

Lai Van Manh and Pham Anh Huyen

Manh L.V. and A.H. Pham (2023), 'The Circular Economy in Viet Nam', in Kimura, F. et
al (eds.), Viet Nam 2045: Development Issues and Challenges, Jakarta: ERIA, pp.
499-552.
 1. Introduction
The circular economy is becoming an inevitable global trend, meeting the requirements
of sustainable development in the context of increasingly degraded natural resources,
a polluted environment, and biodiversity loss due to climate change. Viet Nam has
the potential to become a leader in terms of a circular economy in the Association of
Southeast Asian Nations (ASEAN).

Prior to 2020, the principle of a circular economy was integrated into some of Viet
Nam’s economic models, typically those in the agricultural sector, ecological economic
models, and waste-recycling craft villages. 1 After 2020, the concept was considered
a key orientation for national socio-economic development. Indeed, in the National
Socio-Economic Development Strategy, 2021–2030, with a Vision to 2045, the circular
economy is emphasised as a solution for reconciling the relationship between economic
development and natural resources consumption. Provisions for a circular economy
were thus promulgated in the Law on Environmental Protection 2020.

This chapter evaluates policy tools that have an important role to play in promoting
circular economy adoption in Viet Nam, such as environmental protection taxes and
charges, green public procurement, expansion of manufacturer responsibility, and
recycling markets. A SWOT analysis looks at current conditions under which a transition
to a circular economy can occur, considering three national strategic breakthroughs
related to institutions, technology, and infrastructure. These results help assess the
success of circular economy models into priority sectors. Furthermore, a national road
map for priority sectors, fields, and areas regarding a circular economy is detailed.

2. Overview of a Circular Economy

A circular economy is an industrial system that is restored and regenerated, based on conservation
and enhancement of natural capital, optimising resource productivity and promoting system efficiency
(Morl, 2015). The value of products, materials, and resources is maintained in the economy for as
long as possible, and the economy works to produce minimal waste (EC, 2018). A linear economic
model is only concerned with resource extraction, production, and disposal after consumption,

1
According to Government Decree No. 52/2018/ND-CP dated 12 April 2018 on the development of rural crafts, a ’craft village’
refers to one or many residential areas in hamlets, wards, or the equivalent that practices rural craft(s) activities as follows:
(i) agro–forestry–fishery product processing and preservation; (ii) production of handicraft products; (iii) processing and
preparation of ingredients and materials serving rural crafts; (iv) production of woodwork, straw, ceramic, glass, textile,
embroidery, or minor mechanical engineering; (v) production and sale of ornamental animals; (vi) salt production; and (vii)
other services serving production and livelihood of rural inhabitants. Moreover, Article 56 of the Law on Environmental
Protection 2020 stipulates the requirements for environmental protection in these craft villages. Every craft village must
have an environmental protection plan, an autonomous environmental protection organisation, and environmental protection
infrastructure. Manufacturing establishments and households in a craft village must seek and implement environmental
protection measures as prescribed by law; implement measures for noise, vibration, light, dust, heat radiation, emissions,
and wastewater reduction, and in situ pollution remediation; and collect, classify, store, and treat solid waste as prescribed
by law.

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often leading to the creation of large amounts of waste. In contrast, the circular economy model
focusses on resource management and recycling in a closed loop to avoid generating waste. The
Law on Environmental Protection 2020 defines a circular economy as an economic model that
encompasses the design, production, consumption, and services activities aimed at reducing raw
materials, extending product life, reducing waste generation, and minimising adverse impacts on
the environment.

Conversion from a linear economic model to a circular economy is a practical approach to solving
the fraught relationship between the economy and environment, creating long-term resilience and
economic opportunities as well as providing environmental and social benefits.

A circular economy has five components: (i) a design to create green products and to increase
repairability, recovery, recycling, and reuse of products and components; (ii) application of cleaner
production measures, emission reduction, and the circularisation of materials in the production
stage; (iii) more thoughtful consumption through the provision of better services, increasing the
responsibility of consumers towards the ecological environment; (iv) better waste management
by segregation, end-of-life collection, and waste recycling; and (v) from waste back to resources,
including waste recycling and resource reuse (Morl, 2015).

In a circular economy, the value of products, materials, and natural resources are maintained in the
economy for longer periods of time, minimising waste generation. Measures to implement a circular
economy are diverse, such as refusing to use products harmful to the environment or applying
various measures to repair, reuse, remanufacture, and recycle to achieve the goal of reducing the
consumption of raw materials and fuel. Enterprises adopt strategies such as (i) closing the loop
through design to eliminate waste, pollution, and extraction of materials; (ii) slowing the loop to
keep materials in use for longer periods of time; and (iii) narrowing the loop, by using fewer raw
materials and for more purposes (Bocken, Miller, Evans, 2016). Based on solutions and strategies
for the circular economy, the potential for new business models – such as a circular supply model,
recovery model, long-life extension model, and sharing model – will appear (Table 17.1).2

2
Waste Reduction Week in Canada, Five Business Models of Circularity, https://wrwcanada.com/en/get-involved/resources/
circular-economy-themed-resources/five-business-models-circularity

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 Table 17.1. Value Motivations of a Circular Economy and
Benefits for Consumers

Value Driver Method

Extending the length of an asset’s use cycle Designed to last a long time

Designed for easy recyclability

Designed for easy repair and upgrade

Includes clear guidance for maintenance

Increasing the utilisation of an asset or Increases the sharing of assets

resource Increases resource productivity

Limits negative externalities

Looping or cascading an asset through Reuses material

additional use cycles Recycles used material for use as raw material

Refurbishes the assets

Regenerating natural capital Returns biological nutrients back to the land

Avoids topsoil erosion

Regenerates the nutrients of the soil

Maintains the marine ecosystem

Source: Anbumozhi and Kimura (2018).

A circular economy also helps address co-benefits related to social inequality and ecological crises.
With social equity in mind, a circular economy helps reduce social inequality and works towards
inclusive management to achieve decoupling between gross domestic product (GDP) growth and
the level of resource use and waste generation into the environment. It requires the participation
of all stakeholders from the public sector, mining and raw material enterprises, processors,
manufacturers, distributors, retailers, consumers, and garbage collectors. In particular, the public
sector plays an important role in creating and promoting a circular ecosystem.

Today, digital technological developments are occurring rapidly, such as those related to cyber-
physical systems, internet of things (IoT), simulation, advanced data analytics, robots, augmented
reality, and intelligent tools for the support of human resources. New digital technologies can

502
promote the implementation of a circular economy, including mobile technology, machine-to-
machine communication, cloud computing, social media for business, big data analytics, modular
designing technology, advanced recycling technology, life and material science technology, trace
and return systems, and 3D printing (Anbumozhi, 2022).

Indeed, IoT and the circular economy should be considered as two closely linked components, as
IoT helps form and operate digital technology, creating a driving force to promote the application
of a circular economy. The parallel development of these two components will create synergies to
achieve ambitious economic growth goals while effectively using natural resources and reducing
waste generation and adverse environmental impacts. Each level of the circular economy model can
apply digital technology (Table 17.2).

Table 17.2. Application of Digital Technology in Business

and Waste Management

Micro Meso Macro

(single business (industrial (governance)
model) symbolism)

Production areas Cleaner production, Industrial park Industrial network,

eco-design regional linkage

Consumption areas Green procurement Environmentally Rental services,

friendly industrial design services,

park, eco-industrial repair services

park

Waste management Recycle Market for waste Industrial

system, waste and secondary symbolism, waste

manufacturing material, second- collection system

hand goods

Other support Policies and legal framework, information foundation, capacity

building, digital infrastructure

Source: Anbumozhi (2022).

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There are several potential evolving goods and services that support a transition to a circular
economy, such as eco-design services, design for recycling and reuse, refurbishment and repair
services, markets for raw and secondary materials, and technologies and products supporting
the application of a circular economy. Standards and technical regulations should be set up for
these potential goods and services; ensuring appropriate market openness and trade facilitation in
circular goods and services is also crucial.

3. Barriers to and Conditions for Implementing a

Circular Economy
At the government level, the Organisation for Economic Co-operation and Development (OECD, 2018)
identified 13 barriers for countries to transition to a circular economy. In particular, barriers in
culture, regulations, finance, and vision are challenges, specifically financial resources, regulatory
uncertainty, financial risk, perception, human resources, private sector involvement, political
readiness, and technology solutions. From the perspective of a business enterprise, Bianchini, Rossi,
and Pellerini (2019) highlighted five groups of internal and external barriers to circular business
models: organisational capabilities required, efforts in terms of business definition and corporate
structure, technical barriers including expertise, the absence of a legal framework to guide the
transition, and financial factors associated with the degree of long-term investment and cost.

In addition, legislation needs to consider factors that play a role in promoting this transition on a
national scale. A circular economy platform must be developed by governments synchronously with
enough resources to support change. Development strategies and plans play a fundamental role,
contributing to stimulating the circular economy process at various scales through a systematic
approach similar to the ecological industry approach (i.e. analysis of the flow and possible
coordination from near space). To do this, governments must first focus on institutions, because
institutions are both barriers to and promoters of the compliance economy. Good governance is also
key and can be promoted through equality, participation, consensus, transparency, accountability,
and the rule of law in an effective, efficient, and lasting manner.

Lastly, culture is often a major barrier to the launch of a circular economy platform. Culture governs
the behaviour of businesses and consumers in dealing with nature; in the economic and efficient
use of natural resources; and in waste classification, recycling, and reuse. Economic, social, and
environmental benefits should be made clear as well as the desire to improve the quality of life.
A circular economy focusses on materials and energy flows to prolong the use of resources and
waste management. It helps infrastructure be designed and built in modular and flexible ways and
energy systems become resilient and renewable, reducing costs and creating positive impacts on
the environment.

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4. Policy and Legal Framework Related to the
Circular Economy in Viet Nam
As shown in Figure 17.1, Viet Nam’s policy and legal framework to develop a circular economy
consist of two main groups:

i. policies of the Communist Party and government, reflecting national orientations of the circular
economy (e.g. resolutions of the Central Committee, Committee Secretary, National Assembly,
and government; socio-economic development strategies and development strategies of various
sectors; and national schemes promulgated by the Prime Minister); and

ii. legal provisions prescribed in existing laws and bylaws (e.g. environmental protection and
investment laws and regulations on taxes and incentives).

Figure 17.1. Policy and Legal Framework for the

Development of the Circular Economy in Viet Nam

CE = circular economy.
Source: Authors.

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4.1. Policies of Communist Party and Government
Regarding the circular economy, the perspectives of the Communist Party and government can be
divided as follows:

i. Before the 12th National Congress. Before 2016, the term ‘circular economy’ had not yet been
mentioned in any policy, but there was some movement towards implementing a circular
economy.
ii. During the 12th National Congress. From 2016 to 2020, the term ‘circular economy’ was
indicated in several national plans, such as that for the energy sector and the National Action
Plan on Sustainable Production and Consumption, 2021–2030.
iii. During the 13th National Congress. Since 2021, the concept of a circular economy has been
integrated into the Socio-Economic Development Strategy, 2021–2030, with a Vision to 2045
and Socio-Economic Development Plan, 2021–2025. It also has been mentioned in resolutions
on agriculture, farmer and rural issues, and the collective economy. Other resolutions and
strategies on economic restructuring and the development of industries feature mention of a
circular economy. In June 2022, the Prime Minister issued Decision No. 687/QD-TTg, approving
the scheme for circular economy development in Viet Nam. It aims to decrease greenhouse gas
emissions per GDP by at least 15% compared to 2014; to reuse, recycle, and treat 85% of plastic
waste; and to reduce 50% of plastic waste in the ocean by 2030 (Table 17.3).3

3
Viet Nam Circular Economy, Decision No. 687/QD-TTg dated 7 June 2022 on Approving the Scheme for Circular Economy
Development in Vietnam, https://vietnamcirculareconomy.vn/en/policy-library/decision-no-687-qd-ttg-dated-june-07-
2022-on-approving-the-scheme-for-circular-economy-development-in-vietnam/#:~:text=Decision%20No.-,687%2FQD%2-
DTTg%20dated%20June%2007%2C%202022%20on%20approving,circular%20economy%20development%20in%20
Vietnam&text=On%20June%207%2C%202022%2C%20the,circular%20economy%20in%20Viet%20Nam.

506
 Table 17.3. Orientations and Policies on the Circular
Economy in Viet Nam

STT Policy Contents Related to the

Circular Economy

I Before the 12th National Congress

1.1 Directive No. 36/1998/CT-TW dated - No mention of the term ‘circular

25 June 1998 on strengthening economy’ nor basic solutions of the
environmental protection circular economy, such as recycling
in the period of promoting and reuse.
industrialisation and modernisation - Indicated some orientation related
to the circular economy: ‘Continue
to promote mass movements for
environmental protection such as
Green–Clean–Beautiful Environment,
VAC system, VACR system, Clean
Water and Environmental Sanitation
Week for schools and households’
and ‘use clean technologies that
generate low emissions and consume
less material and energy’.

1.2 Resolution No. 41-NQ/TW dated 15 - No mention of the term ‘circular

January 2004 on environmental economy’ but emphasised solutions
protection in the period of and models related to the circular
promoting industrialisation and economy: ‘encourage economic use
modernisation of resources and energy; produce
and use clean energy, renewable
energy, products and product
packaging that are not harmful or
less harmful to the environment;
recycle and use recycled products’
and ‘collect and treat all domestic
and industrial waste with appropriate
methods; priority given to reuse
and recycling of waste, minimising
landfills, especially in urban areas
which do not have enough space for
landfills.’

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 STT Policy Contents Related to the
Circular Economy

I Before the 12th National Congress

1.3 Resolution No. 24-NQ/TW dated - No mention of the term ‘circular

3 June 2013 on proactively economy’, but emphasised
responding to climate change, solutions and models related to
strengthening natural resources the circular economy: ‘promote
management, and protecting the reuse, recycling and production and
environment recovery of energy from waste’.

II During the 12th National Congress

2.1 Resolution No. 55-NQ/TW dated 11 - Implemented environmental

February 2020 on the orientation protection policies in the energy
of Viet Nam’s National Energy sector in association with the
Development Strategy to 2030 and goals of reducing greenhouse
Vision toward 2045 gas emissions, promoting the
circular economy, and sustainable
development.
- Developed and implemented
the scheme to integrate circular
economy models into the
development strategy of energy
enterprises.

2.2 Conclusion No. 56-KL/TW on - Placed requirements on natural

continuing to implement the disaster prevention and control,
resolution of the 7th Party Central response to climate change,
Committee, term XI, on proactively resource management, and
responding to climate change, environmental protection to be
strengthening natural resources at the centre of all development
management, and protecting the decisions.
environment - Focussed on handling
environmental pollution after 2020,
especially in urban areas.
- Classified waste at source,
especially domestic waste.

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STT Policy Contents Related to the
Circular Economy

II During the 12th National Congress

2.3 National Action Plan on Sustainable - Promoted the circular economy and
Production and Consumption for sustainable development.
2021–2030 - Supported the development and
application of popularisation and
replication of circular economy
models of resources, fuel, and
materials in production and
consumption activities.
- Promoted the application of
circular economy models in waste
management.
- Promoted the application,
popularisation, and replication of
models of classification, collection,
reuse, and recycling of waste and
scrap; and developed training
documents on circular economy
models for waste management in
agriculture, fisheries, electronics,
chemicals, thermal power, plastic,
paper, construction materials, and
other economic sectors.
- Promoted the supply–demand
connection, developing markets
for environmental products and
technologies, recycling products
and technologies, and low-carbon
technologies.
- Gradually built and applied circular
economic models in the field of
consumption, encouraging the
transition from consumption and
ownership of goods to consumption
and use of services.

509
 STT Policy Contents Related to the
Circular Economy

III During the 13th National Congress

3.1 Documents of the 13th National Congress

3.1.1 National Socio-Economic Encourage the development of

Development Strategy, 2021–2030 a circular economy model for
with a Vision to 2045 integrated and efficient use of the
outputs of the production process.

3.1.2 Report on the Socio-Economic Plan, Develop road maps, mechanisms,

2016–2020 and Resolution No. policies, and regulations to build
16/2021/QH15 dated 27 July 2021 and to implement models of green
on the Socio-Economic Development economy, circular economy, and
Plan, 2021–2025 low-carbon economy.

3.2 Resolutions and Directives of the Party and Government

3.2.1 Resolution No. 19-NQ/TW dated 16 - Encourage the development

June 2022 on agriculture, farmers, of green, organic, and circular
and rural areas to 2030, with a agriculture.
vision to 2045 - Encourage the development of
circular agriculture; reuse of by-
products; and application of new,
advanced, and environmentally
friendly technologies, attracting
enterprises to invest in wastewater
and solid waste treatment in
villages, industrial and service
clusters, and concentrated waste
treatment zones.

3.2.2 Resolution No. 20-NQ/TW dated - Prioritise the development of

16 June 2022 on continuing to collective economic organisations
innovate, develop, and improve the associated with the development of
efficiency of the collective economy green economy, circular economy,
and knowledge economy.
- Issue synchronised policies to
attract resources; apply science
and technology; develop a circular

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STT Policy Contents Related to the
Circular Economy

economy, green economy, and

organic agriculture; adapt to
climate change and digital
transformation; and expand the
market for the collective economy.

3.2.3 Resolution No. 43/2022/QH15 Build breakthrough policies, giving

on fiscal and monetary policies priority to encouraging innovation,
supporting economic recovery and digital transformation, digital
development programme economy, green economy, and
circular economy associated with
sustainable development.

3.2.4 Resolution No. 11/NQ-CP Continue to research and

dated 30 January 2022 on the implement breakthrough solutions;
socio-economic recovery and encourage innovation; promote
development programme and digital transformation; and
implementation of Resolution develop the digital economy, green
No. 43/2022/QH15 on fiscal and economy, and circular economy
monetary policies to support the associated with sustainable
programme development.

3.3 Decisions of the Prime Minister

3.3.1 Decision No. 1520/QD-TTg dated 6 Promote the expansion of animal

October 2020 approving an animal husbandry in a closed chain
husbandry development strategy following circular economy models.
for 2021–2030 with a vision to 2045

3.3.2 Decision No. 450/QD-TTg dated 13 Prevent the increasing trend

April 2022 approving the National of environmental pollution and
Environmental Protection Strategy degradation; deal with pressing
until 2030, with a Vision to 2050 environmental issues; gradually
improve the environment; prevent
the loss of biodiversity; improve
climate change response capacity;
ensure environmental security;

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 STT Policy Contents Related to the
Circular Economy

develop and build circular

economy, green economy, and
low-carbon economy models; and
aim to achieve 2030 sustainable
development objectives.

3.3.3 Decision No. 1658/QD-TTg dated Transform the growth model in a

1 October 2021 approving the manner towards ‘greenification’
National Green Growth Strategy, of economic sectors, apply the
2021–2030, with a Vision to 2050 circular economic model through
the efficient extraction and use
of natural resources and energy
that are based on science and
technology, apply digital technology
and digital transformation, develop
sustainable infrastructure facilities
to enhance the quality of growth,
promote competitive advantages,
and reduce adverse impacts on the
environment.

3.3.4 Decision No. 493/QD-TTg dated 19 Promote in-depth restructuring

April 2022 approving the Strategy of export goods; accelerate
for Merchandise Exports and Imports industrialisation and
to 2030 modernisation; increase the
proportion of exports of products
with added value, and green,
circular economy, eco-friendly
products.

3.3.5 Decision No. 687/QD-TTg dated 7 - Contribute to the goal of reducing

June 2022 approving the scheme greenhouse gas emissions.
for circular economy development - Raise awareness and concerns
in Viet Nam of enterprises and investors in
Viet Nam regarding the circular
economy, and promote the
application of the circular economy
model to promote the green
transition of economic sectors.

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STT Policy Contents Related to the
Circular Economy

- By 2025, circular economy projects

are essential in the implementation
phase and reaping economic, social,
technological, and environmental
effectiveness; contribute towards
restoration of renewable
resources, reduction of energy
consumption, and increase of the
ratio of renewable energy over total
energy supply, forest cover, waste
recycling rates, import substitution
rates of agricultural, forestry,
fishery, and export products.
- By 2030, circular economy projects
become a primary drive in reducing
energy consumption with major or
total autonomy in energy demand
by utilising renewable energy and
in increasing forest cover.
- Circular economy models assist
the development of green living,
encourage waste segregation, and
promote sustainable consumption.
- By 2025, reuse, recycle, and treat
85% of plastic waste produced;
reduce 50% of plastic waste in the
ocean compared to the prior period;
and gradually reduce production
and use of non-biodegradable
nylon bags and disposable
plastic products. Drastically
increase organic waste-recycling
capacity in urban and rural areas.
Raise awareness regarding the
production, consumption, and
disposal of plastic waste, non-
biodegradable nylon bags, and
disposable plastic waste.
- By 2030, collect and treat 50%
of urban municipal solid waste
to standards and regulations

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 STT Policy Contents Related to the
Circular Economy

via circular economy models;

recycle 100% of organic waste in
urban areas and 70% of organic
waste in rural areas; no longer
bury municipal solid waste within
circular economy models in urban
areas; maximise the collection and
treatment of urban wastewater to
standards and regulations.
- The circular economy model
plays a vital role in improving the
quality of life and resistance of
the public to climate change and
ensuring equality in conditions
and opportunities to improve the
capacity, productivity, and income
of workers from a circular economy.

Note: A VAC system (vuon, ao, chuong) refers to a garden/pond/livestock pen, while a VACR system (vuon, ao, chuong, rung)
denotes a garden/pond/livestock pen/forest.
Source: Authors.

4.2. Regulations on the Circular Economy in Viet Nam

In 2020, the concept of the circular economy was regulated in the Law on Environmental Protection.4
Following Clause 11, Article 5 of this law, the government affirmed its commitment to incorporate
and to promote a circular and green economy in the formulation and implementation of its socio-
economic development strategies, plans, programmes, and projects. Article 142 of the law
promulgates a circular economy.

According to the law, a circular economy is officially defined as an economic model that encompasses
design, production, consumption, and services activities aimed at reducing raw materials, extending
product life, reducing waste generation, and minimising adverse impacts on the environment. The
law also assigns responsibilities for a circular economy to relevant government agencies and
stakeholders. Ministries, ministerial agencies, and provincial people’s committees must incorporate
circular economy principles when formulating development strategies; planning a programme
or project; and managing, reusing, and recycling waste. Every business must also establish a

4
The Law on Environmental Protection 2020 replaced the Law on Environmental Protection 2014; it took effect 1 January
2022.

514
management system and take measures to reduce the extraction of natural
resources, reduce waste, and increase waste recycling and reuse from
setting up a project to designing a product or goods for production and
distribution.

In addition, the government is required to detail criteria, road maps, and

mechanisms for encouraging the implementation of a circular economy in
conformity with national socio-economic conditions. The government has
built a relatively strong legal and policy foundation to promote a circular
economy in various sectors, through policies on waste segregation at the
source, green public procurement, extended manufacturer liability, recycling
markets, various preferential and supportive measures, development of
environmental industry, environmental services, green purchase, green
credit, and green bonds.

Based on the concept outlined under the law, Decree No. 08/2022/ND-CP
dated 10 January 2022 provides more detailed regulations on the criteria,
road maps, and incentive mechanisms for the implementation of a circular
economy in Viet Nam. It identifies three groups of criteria for a circular
economy:

i. reduce the exploitation and use of non-renewable and water resources;

increase the efficiency in the use of resources, raw materials, and
materials; and save energy;
ii. extend the useful life of materials, equipment, products, goods, and
parts; and
iii. reduce waste generated, and minimise adverse impacts on the
environment, including by reducing solid waste, wastewater, and
emissions; reducing the use of toxic chemicals; recycling waste, and
recovering energy; reducing disposable products; and developing
green purchasing habits.

To achieve these objectives, the decree suggests measures for businesses

outlined below:

i. owners of production, business, and service establishments should

take one or more measures in the following order of priority: (a) restrict
the use of non-eco-friendly products; make the best use of equipment
and products; and increase efficiency in product manufacturing or
efficiently use natural resources, raw materials, and materials; (b)
extend the life cycle of products and their parts through reuse, repair,
refurbishment, remanufacture, or repurpose; and (c) reduce waste
generated by recycling waste or incineration of waste with energy
recovery; and
ii. owners of investment projects; businesses; dedicated areas for
production, business operations, and service provision; and industrial

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 clusters should undertake one or more of these measures: (a) design
an optimal master plan that establishes a connection between
investment projects and businesses to improve efficiency in the
use and reduction of the consumption of soil, water, minerals, and
energy; increase the recycling rate; and reduce the total amount of
waste generated; (b) develop and use clean and renewable energy
as prescribed by law; (c) collect and store rainwater for reuse; and
collect, treat, and reuse wastewater; and (d) carry out industrial
symbiosis activities in accordance with the law on the management
of industrial parks and economic zones.

Secondly, the decree stipulates that the Ministry of Natural Resources and
Environment (MNRE) must preside over and cooperate with ministries,
ministerial agencies, and provincial people’s committees in formulating
and submitting to the Prime Minister a national action plan on the circular
economy before 31 December 2023; build and operate a platform for
sharing data on the application of the circular economy model; and
establish and introduce a methodological framework for assessment of
the implementation of the circular economy. Ministries and ministerial
agencies must formulate and approve action plans for implementation
of a circular economy; organise the dissemination of laws and provision
of training on the circular economy; incorporate specific criteria for
implementation of the circular economy in development strategies,
plans, programmes, and projects and in the management, reuse, and
recycling of waste; manage information on the implementation of the
circular economy and integrate it with MNRE’s information system; and
organise pilot applications of the circular economy in the energy, fuel,
and waste industries according to the action plans. Provincial people’s
committees must formulate provincial action plans for implementation in
conformity with the national action plan and organise pilot applications of
the circular economy to the energy, fuel, and waste industries according
to the action plans.

The decree requires three kinds of action plans for the circular economy:
a national action plan; provincial action plans; and action plans for
various industries, fields, and products. Owners of investment projects
and businesses – as well as investors in construction and commercial
operations of infrastructure in dedicated areas for production, business
operations and service provision, and industrial clusters – are encouraged
to apply the circular economy model earlier than the road map specified
in action plans as prescribed.

Mechanisms and incentives to encourage the implementation of a

circular economy have also been regulated in law. According to Decree
No. 08/2022/ND-CP, the government is prioritising the development
of a circular economy by conducting scientific research, developing

516
applications, transferring technologies, producing equipment, and training personnel to implement
a circular economy; and providing a platform for connecting information and sharing data on
the circular economy. In addition, the government is encouraging the following activities for the
development of a circular economy:

i. developing technologies and technical solutions, and providing circular economy assessment,
design, and consulting services as prescribed by law;
ii. developing models for connecting and sharing the circular use of products and waste;
establishing cooperative recycling groups, unions and alliances, and models for regional and
rural–urban connections to carry out investment, manufacturing, and business activities,
thereby meeting circular economy criteria;
iii. adopting industrial symbiosis measures in accordance with regulations of law on the
management of industrial parks and economic zones;
iv. developing discarded product reuse and waste-recycling markets;
v. mobilising social resources for the implementation of a circular economy as prescribed by law;
and
vi. developing international cooperation, exchanging experience, knowledge, and technologies in
relation to the circular economy as prescribed by law.

Furthermore, organisations or individuals that carry out activities or have projects applying the
circular economy model are entitled to incentives or assistance in environmental protection.
Incentives and assistance include exemption and reduction of land levies and rents; incentives
from the Viet Nam Environmental Protection Fund, provincial environmental protection funds, and
Vietnam Development Bank; corporate income tax incentives; and subsidies for environmental
protection products and services. Moreover, organisations and individuals implementing circular
economy models are entitled to incentive policies on green credit and green bonds.5

5. Practical Application of a Circular Economy in

Viet Nam
In Viet Nam, many industries and localities have models that include manifestations of a circular
economy, such as eco-industrial parks, cleaner production models, waste-recycling craft villages, or
circulation initiatives of enterprises (Table 17.4). However, some initiatives have been unsustainable
and even caused significant impacts on environmental protection objectives.

5
Article 154, Article 155, Article 156, and Article 157 of Decree No. 08/2022/ND-CP.

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 Table 17.4. Models Embedding the Principles of the
Circular Economy in Viet Nam

Category Circular Economy-Related Principles

Production

Agriculture, forestry, and Several circular models exist in many provinces

fisheries (e.g. VAC and VACR models to make use of
biomass; models of collecting agricultural waste
such as tree trunks, straw, and rice husks; a
bioaquatic model; and an organic farming model).
In cultivation, the by-products of peanut shells,
corn stalks, rice straw, cassava stalks, soybean
hulls, firewood from perennial plants, and
firewood from annual plants are used. Straw is
also used as food for cattle, biological padding,
mushroom cultivation, and for composting
as traditional organic fertilizer and burning.
Regarding livestock, by-products are used
in traditional composting, biogas production,
microbial manufacturing biological padding and
for commercial purposes such as earthworm
farming. In aquaculture, the collection rate is
more than 90%; by-products are used for the
extraction process of biological compounds; food
products, such as fish oil; and producing organic
fertilizer.

Mining Mining activities have the potential to apply

the principles of the circular economy to make
efficient use of waste from mining, minimising
adverse impacts on the environment.

Manufacturing and processing Circulation of water, raw materials, and materials

in production and business establishments has
been applied (e.g. in the pulp and paper industry
and metallurgy).

Water supply, management, and Waste collection, classification, and treatment

treatment units act as intermediaries in promoting recycling,
reuse, and waste reduction. There are models of

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Category Circular Economy-Related Principles

Production

plastic waste treatment, composting, and energy

recovery from waste as well.

Construction Waste generated from construction activities,

such as rocks, bricks, tiles, mortar, concrete,
and adhesive materials, are used, reused, and
recycled.

Transport The model of transforming from products to

services, such as leasing batteries and sharing
models, is popular.

Repair and trade of second-hand Repair and refurbishment are quite common in
goods Viet Nam.

Energy There are current waste-to-energy models and

renewable energy models in Hau Giang, Ha Noi,
and some localities.

Other services Consulting services on evaluating and providing

technologies, equipment, and solutions related to
a circular economy – as well as training on the
circular economy – have been deployed by many
universities.

Meso Level

Industrial parks, industrial Some eco-industrial parks have applied

clusters industrial symbiosis and circularity initiatives
within their limits (e.g. Nam Cau Kien Industrial
Park).

Urban areas, residential areas Some pilot activities in residential clusters have
begun, such as wrapping vegetables and fruits
with banana leaves, using glass bottles and
bamboo or paper straws, and using paper cups
instead of plastic cups and cloth bags instead of
plastic bags.

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 Category Circular Economy-Related Principles

Consumption

Intermediate consumption The market for raw materials and fuels for the
recycling and reuse of products has been formed.

Governmental consumption Legal regulations on green public procurement

have been finalised; the government and private
sector aim to integrate environmental criteria
into the procurement process.

Household consumption By promoting the consumption of eco-labelled,

energy-saving products, renewable energy tends
to increase.

Waste Management

Solid waste Some models demonstrating the circular

economy approach in the field of waste recycling
include recycling iron, aluminium, copper, zinc,
glass, paper, and plastic from scrap in large,
medium, and small-scale industrial production
or craft villages; plants producing micro-organic
fertilizers from domestic waste, and clean
soil from dredging sludge and sewage sludge
collected from domestic wastewater treatment
plants; establishments using agricultural waste
to grow mushrooms and produce livestock feed;
plants producing building materials from ash,
slag, and gypsum generated from coal-fired
thermal power, fertilizer, and chemical plants;
plants producing refuse-derived fuel and refuse,
derived paper, and plastic densified fuel from
domestic industrial waste; energy recovery and
electricity from waste incineration plants; and
hazardous waste recycling plants.

Wastewater Wastewater circulation in some industrial zones

(e.g. Nam Cau Kien Industrial Park); wastewater
treatment stations with reverse osmosis
technology to provide treated wastewater

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 Category Circular Economy-Related Principles

Waste Management

for production; and wastewater treatment to

meet the requirements of watering plants and
aquaculture.

Emissions Emissions treatment systems use cloth-bag dust

filtration technology to recover products. Plants
are recovering carbon dioxide (e.g. breweries)
and sulphur dioxide (e.g. thermal power plants).

Note: A VAC system (vuon, ao, chuong) refers to a garden/pond/livestock pen, while a VACR system (vuon, ao, chuong, rung)
denotes a garden/pond/livestock pen/forest.
Source: Authors.

6. The Circular Economy in ASEAN and Japan:

Requirements and Opportunities for Viet Nam
6.1. Framework for a Circular Economy in the ASEAN
Economic Community
The transformation from a linear economy model to a circular economy model is happening in
ASEAN as several ASEAN Member States (AMSs) have issued strategies, policies, and road maps
to address the sustainability challenges of resource depletion, plastic waste, and climate change.
In 2021, ASEAN adopted the Framework for Circular Economy for the ASEAN Economic Community
(Figure 17.2). It sets up a long-term vision for a circular economy based on existing initiatives and
identifies focus areas for action (ERIA, 2021). It has three strategic goals: a resilient economy,
resource economic efficiency, and sustainable and inclusive growth. To create a common context
for circular economy initiatives for AMSs, the framework provides six guiding principles: (i) promote
ASEAN integration and the development of regional value chains; (ii) consider broader impacts on
the economy, sectors, and society; (iii) recognise the unique economy of each AMS whilst supporting
long-term growth prospects of the region; (iv) encourage ASEAN-wide coordination on knowledge,
technology transfer, and capacity building; (v) evaluate financial and institutional feasibility and
sustainability; and (vi) aim to function within the reality of international production networks and
linkages prior to implementation.

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 Figure 17.2. Framework for a Circular Economy for the
ASEAN Economic Community

AMS = ASEAN Member State, ASEAN = Association of Southeast Asian Nations.

Source: ERIA (2021).

522
According to the framework, five strategic priorities are key for the transition to a circular economy:

i. Strategic Priority 1. Harmonise standards, and mutually recognise circular products and
services.
ii. Strategic Priority 2. Encourage trade openness and trade facilitation in circular goods and
services.
iii. Strategic Priority 3. Enhance the role of innovation, digitalisation, and emerging/green
technologies.
iv. Strategic Priority 4. Foster competitive sustainable finance and innovative environmental,
social, and governance (ESG) investments.
v. Strategic Priority 5. Use energy and other resources efficiently.

Despite the many initiatives undertaken, they have been fragmented, with insufficient collective
targets and a lack of a synergetic approach. Indeed, the transition to a circular economy at the
regional level demands cooperation amongst sectoral bodies; collaboration amongst the public
and private sector and communities; as well as preservation of the efforts with commitment. The
process must be built upon emerging best practices at the national level and tips for those AMSs
devising their own road maps to facilitate an ASEAN-wide transition to a circular economy.

6.2. Legislation and Policy Framework for a Circular

Economy in Japan
Japan's approach to a circular economy is a typical example at the national level. Since 1991, it has
implemented a circular economy by formulating legal provisions to transform the country into a
recycling-based society. The legal core is the Basic Law for Establishing a Recycling-Based Society,
which entered into force in 2002, and set out quantitative targets for recycling in the long term. As
a result, Japan quickly achieved the highest recycling rate in the world. In 2007, only 5% of Japan's
waste went to landfills, compared with 48% of that of the United Kingdom in 2008. Since 2010, the
recycling rate for metals in Japan reached 98% (MOE, 2010). Its recycling law for electrical home
appliances ensures that over 50% of electronic products are recycled, compared with 30%–40%
in Europe (METI, 1998; Hotta, Santo, Tasaki, 2014). About 74%–89% of the materials contained in
these devices have been recovered to produce similar products, helping save costs and reduce
dependence on mining resources (WEEEForum, 2012).

At the national level, the implementation of a circular economy is examined by using (i) a resource
productivity indicator that measures material use as a proportion of GDP; (ii) an indicator for the
cyclical use rate of materials in the economy, measured by the material reused as a proportion
of total material used by the economy; and (iii) an output indicator, measuring how much waste is
buried in landfills. These indicators are associated with specific targets.

The legislation and policies on the circular economy in Japan have been collected, examined, and
summarised in Table 17.5.

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 Table 17.5. Overview of Legislation and Policy on the
Circular Economy in Japan

Name Year Overview

Legislation

Basic Act on 2000 Promotes policies for establishing a sound

Establishing a Sound (Revised in material-cycle society and formulating the
Material-Cycle 2013) Fundamental Plan for Establishing a Sound
Society Material-Cycle Society.

Waste Disposal and 1970 Preserves the living environment and

Public Cleansing Act (Revised in improves public health through the
2017) restriction of waste discharge; appropriate
sorting, storage, collection, transport,
recycling, disposal, and clarification
of waste; and conservation of a clean
environment.

Act on the Promotion 1991 Ensures the effective use of resources,

of Effective (Revised in reduces the generation of used products and
Utilisation of 2001) by-products, and promotes the utilisation
Resources of recyclable resources and reusable
parts to contribute to waste reduction and
environmental preservation.

Act on Recycling 1998 Regarding specified post-consumer home

Home Electrical appliances, stipulates the roles of each
Appliances player: collection from consumers by
retailers, recycling by manufacturers or
importers as well as payment of fees for
collection, and transport and recycling
by consumers when they discard those
appliances.

Act on Recycling 2002 Promotes recycling and proper disposal

of End-of-Life of end-of-life vehicles by clarifying the
Automobiles roles of car owners, collection operators,
fluorocarbon-recovery operators,
dismantling operators, shredding,
and sorting operators, and vehicle
manufacturers and importers.

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Name Year Overview

Legislation

Act on Promotion 1995 Promotes the reduction of waste containers

of Sorted Collection and packaging discharged and the sorted
and Recycling of collection thereof as well as the recycling
Containers and of waste containers and packaging that
Packaging are obtained through the sorted collection
that conform to sorting standards to ensure
proper management of waste and effective
use of resources through reduction of
municipal solid waste and adequate use of
recyclable resources.

Act on Promotion of 2022 Promotes the circulation of plastics in a

Resource Recycling (Scheduled to comprehensive manner.
on Plastics be enacted)

Act on Promotion 2012 Considering circumstances where a

of Recycling of considerable portion of metals or other
Small Electrical useful materials used in electrical and
and Electronic electronic equipment is disposed of without
Equipment being recovered, promotes the recycling of
small electrical and electronic equipment,
thereby ensuring proper disposal of waste
and effective use of resources.

Act on the Recycling 2000 Requires contractors to sort and to recycle

of Construction and waste generated in construction and
Demolition Waste demolition work.

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 Name Year Overview

Visions and plans

Circular Economy 1999 Consists of four chapters: (i) the way forward
Vision 1999 (developed and to a circular economy, (ii) reconstruction of
published by waste management and recycling measures
METI) towards the establishment of a circular
economy, (iii) future challenges and policy
responses towards the establishment of a
circular economy, and (iv) status and issues
in individual areas. Priority sectors include
containers and packaging, home appliances
and batteries, automobiles and bicycles,
construction material, general industrial
waste, and others (waste oil, gas and oil
equipment, and aerosol cans).

Circular Economy 2020 To demonstrate the strengths that Japanese

Vision 2020 (developed and companies have developed through their
published by 3R efforts in the global market and to
METI) strengthen industrial competitiveness in
the medium and long term, shows the basic
direction of Japan's circular economy policy
from three perspectives: (i) the transition
towards more circular business models,
(ii) appropriate evaluation from the market
and society, and (iii) early establishment
of a resilient resource circulation system.
Priority sectors include plastics, textiles,
carbon fibre reinforced polymers, batteries,
and photovoltaic panels.

First Fundamental 2003 Accelerates the transition to sustainable

Plan for Establishing production and consumption models through
a Sound Material- (i) conservation of nature and enhancement
Cycle Society of a virtuous socio-economic cycle, (ii)
shift in consciousness and behaviours in
daily life, (iii) shift in consciousness and
behaviours toward manufacturing, (iv)
activation of various entities' activities for
establishing a sound material-cycle society,

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Name Year Overview

Visions and plans

and (v) enhancement of systems for proper

circulation and disposal of waste. Priority
sectors include biomass, appropriate
circulation and disposal of waste, treatment
of waste containing hazardous substances,
and monitoring of illegal dumping of waste.

Second Fundamental 2008 Formulated in consideration of the results of

Plan for Establishing past efforts, progress in achieving targets,
a Sound Material- and changes in socio-economic conditions
Cycle Society such as global resource constraints and
the need to cope with environmental issues
such as global warming. The main directions
were (i) conserving nature and enhancing a
virtuous socio-economic cycle; (ii) realising a
circular society based on the characteristics
of each region; (iii) establishing a socio-
economic system with minimal resource
consumption and high energy efficiency; (iv)
establishing a lifestyle based on the concept
of Mottainai, and accelerating partnerships
amongst related entities; (v) promoting
the 3R concept in economic activities such
as manufacturing; and (vi) enhancing the
system for appropriate circulation and
disposal of waste. Priority sectors include
biomass, appropriate circulation and
disposal of waste, appropriate treatment
of waste containing hazardous substances,
and monitoring of illegal dumping of waste.

Third Fundamental 2013 Formulated to cope with various changes

Plan for Establishing and to implement the formation of a sound
a Sound Material- material-cycle society in Japan and abroad
Cycle Society in an integrated manner in cooperation with
various actors, including the promotion of the
3Rs, based on the premise of environmental
conservation and in cooperation with

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 Name Year Overview

Visions and plans

the various entities constituting society.

The main directions included (i) a society
where circulation in the environment and
circulation in the economy are harmonised,
(ii) establishment of a concept of a 3R
lifestyle and a regional circular sphere,
(iii) establishment of a socio-economic
system with high resource efficiency, (iv)
realisation of safety and security, and (v)
international initiatives. Priority sectors
included plastics; biomass; household
food loss; base metals, rare metals, and
other metals; appropriate treatment of
waste containing hazardous substances,
mercury, waste containing mercury, and
agricultural chemicals stored underground;
monitoring of illegal dumping of waste; and
strengthening waste management systems
in case of disaster.

Fourth Fundamental 2018 Aims for the integrated improvement

Plan for Establishing of environmental, economic, and social
a Sound Material- aspects. A vision, indicators, and planned
Cycle Society measures have been set for seven
pillars: (i) integrated measures towards a
sustainable society, (ii) regional circular and
ecological sphere, (iii) resource circulation
throughout the entire life cycle, (iv) proper
waste management and environmental
restoration, (v) disaster waste management
systems, (vi) international resource
circulation, and (vii) sustaining fundamentals
for 3R and waste management. Priority
sectors include plastics; biomass; base
metals, rare metals, and other metals;
earth and rocks; construction materials;
products and materials introduced widely
as a measure against global warming and

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 Name Year Overview

Visions and plans

other environmental problems, lithium-

ion batteries, and carbon fibre-reinforced
plastics; POPs, mercury, waste containing
mercury, and agricultural chemicals stored
underground; waste electronic substrates;
and household food loss.

3R = reduce, reuse, recycle; METI = Ministry of Economy, Trade and Industry.

Source: Nippon Koei Vietnam International (2022).

Japan has developed several well-known circular models in urban and rural areas, including eco-
towns and eco-villages. Kawasaki is one eco-town where resources are reused and recycled. During
Japan’s era of high economic growth (i.e. 1950s to 1970s), Kawasaki was a leading industrial city that
suffered from air and water pollution as well as poor waste disposal. The local government joined
with residents to solve this environmental contamination by signing agreements with companies
over air pollution control. Today, Kawasaki is building an economy and society based on circulating
resources, taking advantage of its expertise in promoting environmental industries and recycling.
The Fundamental Strategy of the Kawasaki Sustainable-Energy City Plan was thus developed. It
consists of four pillars:

i. Companies contribute to improving their green credentials through the construction of advanced
recycling facilities and processes of eliminating factory effluent and industrial discharge.
ii. Companies develop sustainable, environmentally friendly districts through research on energy
savings and recycling, management plans, and promotion of research and development of the
industry.
iii. Business alignment encourages the area’s ecology with the construction of the Kawasaki Zero-
Emission Industrial Complex, hybrid cars, and synergic recycling activity in the area.
iv. Companies announce their achievements and convey their ideas to society and developing
countries by constructing an eco-town centre, implementing ecology studies and sharing
information on achievements and ideas. The model also contributes to local employment and
effective land utilisation by attracting businesses to eco-town areas, branding the area and
overall industrial promotion and regional revitalisation (GEC, 2005).

Another related circular model in rural areas is an eco-village (Ogata, 2014). Satoyama – areas
between foothills and arable land – is a production ecosystem featuring secondary forests, farmlands,
irrigation ponds, grasslands, and human settlements. Humans create such areas to produce food
and fuel, conserve land and headwaters, and provide places for leisure. The initiative intends
harmony with nature, comprising human communities where the maintenance and development
of socio-economic activities align with natural processes. The initiative is based on five ecological

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and socio-economic perspectives: (i) resource use within the carrying capacity and resilience of the
environment; (ii) cyclic use of natural resources; (iii) recognition of the value and importance of local
traditions and cultures; (iv) multi-stakeholder participation and collaboration in sustainable and
multi-functional management of natural resources and ecosystem services; and (v) contributions
to sustainable socio-economies including poverty reduction, food security, sustainable livelihoods,
and local community empowerment (Matsuya, 2013).

To promote a transition to a circular economy, innovation also plays an important role. Japan is a
world leader in eco-innovation, and the environmental market in Japan has been rapidly expanding
since the second half of the 1990s. The Ministry of the Environment; Ministry of Economy, Trade
and Industry; Ministry of Education, Culture, Sports, Science and Technology; and Council for
Science and Technology Policy are major contributors to eco-innovation in Japan. The main policies
include Economic and Fiscal Reform (2007), Economic Growth Initiative (2007), Becoming a Leading
Environmental Nation in the 21st Century: Japan’s Strategy for a Sustainable Society (2007), Keys
to Create Innovation and Promote Eco-Innovation (2007), Cool Earth Innovation Energy Technology
Program (2008), Third Science and Technology Basic Plan (2013), and Intellectual Property Strategic
Program (various years). Many policy instruments, such as mobilisation of financing, have already
been mentioned, including the Industrial Cluster Policy, which illustrates how public support can
be used to access market and private financial resources; eco-town projects, which demonstrate
how central government initiatives can generate local action; market-based instruments that focus
on subsidies and public support schemes for renewables; the Japan Voluntary Emissions Trading
Scheme; green public procurement, which became mandatory in 2001; and awareness raising and
training (Leflaive, 2008).

6.3. Requirements and Opportunities for Viet Nam’s Circular

Economy
Based on the case study of Japan and The Framework for Circular Economy for the ASEAN Economic
Community, several requirements and opportunities for Viet Nam to promote a circular economy
model are suggested:
i. A legal system should be established, which specifies the objectives and tasks to be performed,
measures and incentives, and responsibilities and coordination amongst stakeholders to
develop a circular economy. It is necessary to consider revising and supplementing other modes
as well, such as the environmental protection tax and laws on consumer protection and public
investment.
ii. A national action plan and implementation road map should be detailed to transition from a
linear to a circular economy. Specific actions and tasks should be aligned with implementing
a circular economy, such as product design, manufacturing, consumption, disposal, waste
management, secondary material management, investment innovation, and initiatives.
iii. Businesses should play a central role in implementing a circular economy. They can enjoy
relevant preferential policies and incentives from the government, as well as voluntarily re-
innovate their businesses towards protecting the environment, saving resources, and improving
competitiveness.
iv. All stakeholders should be engaged in the transition to a circular economy since it is considered

530
 a systemic change – requiring all stakeholders from the public and private sectors, citizens,
knowledge institutions, and non-governmental organisations to play roles. Accordingly, formal
stakeholder engagement mechanisms are essential to inform circular economy policymaking.
For example, forums and websites that are certified by the government should provide
knowledge and services as well as undertake public consultation on circular economy issues.
v. A monitoring framework should be built to show progress towards predefined circular economy
targets. The data collected allow policymakers to monitor progress towards the achievement of
targets to evaluate and to adjust circular economy policies. Furthermore, the framework could
promote transparency by allowing all interested stakeholders to monitor the progress towards
achieving a circular economy.
vi. A national circular economy information system should be established to monitor and to adjust
policy. Collecting and analysing data related to the circular economy inform policymakers,
assessing the effectiveness of circular economy policies and adjusting them when needed.
To enhance policymaking based on robust evidence and data, local governments and relevant
stakeholders should actively harmonise and streamline data collection, ensuring better data
quality and timeliness. This also encourages data sharing from the private sector to enable
comprehensive assessment and projections on waste, resources, and socio-economic and
environmental impacts caused by economic activities.
vii. Japan and Viet Nam should work together to share experiences and best practices in the
adoption and monitoring of circular economy implementation, especially in waste management,
digital technologies, eco-cities and eco-villages, and trade promotion of environmental goods.

7. SWOT Analysis of Implementation of a

Circular Economy in Viet Nam
A SWOT analysis provides insights for policymakers to take advantage of opportunities by
employing strengths and avoiding threats by correcting weaknesses. The following SWOT analysis
was conducted based on comprehensive research on the national context and consultation with
relevant experts. This section summarises the strengths and opportunities for the implementation
of a circular economy in Viet Nam, followed by an analysis of weaknesses and threats. It examined
regulations, the market, culture, entrepreneurship support, financing and capital, industry, and
technology.

7.1. Strengths and Opportunities

The main strengths and opportunities for Viet Nam to transit to a circular economy include the
following.
i. The development of a circular economy has been affirmed in key documents of the 13th National
Congress, especially in the Strategy for Socio-Economic Development, 2021–2030. Laws and
bylaws regulate requirements and methods for implementing a circular economy as well. The
legal system has been gradually revised with a market-based approach, and the development
of legal documents is increasingly consistent and synchronised, respecting the principles and
laws of a market economy.

531
ii. The rapid development of science and technology, particularly the Fourth Industrial Revolution
and the internet, have contributed to the formation of new solutions and business models that
exploit resources more efficiently.
iii. Greener financial capital continues to grow. Over the last 20 years, green credit and bonds
have become important tools to raise capital for projects that benefit the environment, respond
to climate change, and support sustainable development goals and the Paris Agreement. Viet
Nam’s green capital market has great potential to attract domestic and international investors
in renewable energy, waste management, green agriculture, low-carbon transport, and water
management.6
iv. The awareness and demand of domestic consumers have been a considerable driving force
for innovation in the manufacturing and services sectors. Accordingly, this requires cleaner
production and supply of more environmentally friendly goods and services.
v. The international integration and implementation of trade commitments in new-generation free
trade agreements have created transformational pressures on the manufacturing and business
sectors, since standards and technical regulations on products and goods are associated with
promoting recycling, reuse, and compliance with environmental regulations.
vi. In Viet Nam, many new markets have been formed, such for environmental goods and services,
secondary materials, environmentally friendly products, and green bonds and green credits.
vii. The transition to a circular economy has occurred in many countries, including developed and
developing countries. Lessons from such transitions provide valuable experience for Viet Nam
in formulating and implementing a circular economy model.

7.2. Weaknesses and Threats

Viet Nam still has many challenges and obstacles that need to be overcome, including the following.

i. A systematic approach to governance, as well as in economic activities, has not been recognised.
A holistic approach that cuts across sectoral policies is key to a circular economy. It also requires
shared responsibility across levels of government and stakeholders. Viet Nam shows a lack of
synchronisation in developing and implementing strategies, master plans, and plans. There has
been ineffective coordination amongst all levels and sectors as well as limited cross-sectoral
and inter-regional perspectives in formulating and approving development master plans and
plans.
ii. The effectiveness and enforcement of legal provisions are still limited. Although Viet Nam has
built up a comprehensive system of policy tools to promote the transition to a circular economy,
the implementation of such regulations has been low.
iii. Some sectors still take short-term profit goals without considering long-term and sustainable
benefits from environmental protection and circular production. For example, some enterprises
have violated environmental regulations to reduce their costs for handling pollution. Others
intend to implement a circular economy, but their motivation comes from enjoying the incentives
and support of the government instead of their social responsibility.

6
From 2016 to 2030, Viet Nam could attract about $753 billion of investment in climate, with the majority (about $571 billion)
for transport infrastructure construction. Investment in renewable energy could attract $59 billion, of which more than half
($31 billion) is in solar projects, and $19 billion is in small hydro projects. About $80 billion will be invested in the green
building sector (IFC, 2016).

532
iv. The markets for environmental goods and services, environmentally friendly products, and
recycled products are not a focus and do not operate in line with international markets. One of
the reasons is that there has not been a complete set of standards and technical regulations on
environmentally friendly and recycled products in Viet Nam.
v. The government has not taken a prominent role in supporting the development and regulation
of the markets and the behaviour of actors towards the goal of efficient use of natural
resources and promoting production and consumption of environmental goods and services
and environmentally friendly products.
vi. Some policy tools, such as public investment, consumer rights, the value-added tax, and
environmental protection tax, have not been synchronised to ensure transparency, fairness,
and sustainability in using natural resources. Also, these have not created the financial pressure
and motivation to promote technological innovation, improving the social responsibility of
businesses and consumers to realise circular economy goals.
vii. The apparatus, information and data system, and mechanism for monitoring the implementation
of a circular economy have not yet been formed. At present, many ministries, line ministries,
associations, universities, and research institutes have engaged in the development of a circular
economy in Viet Nam, but there is still a lack of an agency guiding and coordinating the overall
activities related to the circular economy.
viii. The production and consumption of environmentally friendly products and services have not
been popular. Clean production and consumption and sustainable consumption are recognised
as concepts in policy and legal documents rather than widely applied in practice. There has been
low awareness and responsibility for the efficient exploitation, use, and management of natural
resources, as well as the collection, classification, recycling, and reuse of waste in economical
and daily activities.
ix. Financial resources for the implementation of the transition to a circular economy are estimated
to be huge. However, their mobilisation has not been effective. For instance, mechanisms and
policies for investment incentives in solid waste treatment have been institutionalised, but
access to loans has been limited, failing to attract different economic stakeholders.
x. The existing infrastructure has not satisfied the practical requirements for environmental
management. It lacks synchronisation in technologies of waste collection, treatment, recycling,
and reuse. Viet Nam's position in terms of readiness for the Fourth Industrial Revolution
compared to other countries is low. In addition, the small and fragmented scale of production
and business has not been proportionate to the high technology investment. The linkages
between production and business are still weak.

533
 Table 17.6. Viet Nam and Other Countries in Promoting
Implementation of a Circular Economy

GDP Governance Environmental

Global Indicator Performance
Innovation Index
Total Rank
Index Score Rank
($ million) Score Rank

ASEAN

Singapore 396,987 35 8 57.8 8 58.1 39

Malaysia 372,701 37 36 41.9 36 47.9 68

Thailand 505,982 24 43 37.2 43 45.4 80

Viet Nam 362,638 39 44 37.0 44 34.4 141

Indonesia 1,186,093 16 87 27.1 87 37.8 117

Philippines 394,086 36 51 35.3 51 38.4 111

Cambodia 26,961 106 109 22.8 109 33.6 139

Lao PDR 18,827 118 117 20.2 117 34.8 130

Myanmar 65,068 80 127 18.4 127 25.1 179

Brunei Darussalam 14,007 133 82 28.2 82 54.8 46

ASEAN = Association of Southeast Asian Nations, GDP = gross domestic product, Lao PDR = Lao People’s Democratic Republic.
Sources: World Bank, GDP (current US$), https://data.worldbank.org/indicator/NY.GDP.MKTP.CD (accessed 15 June 2022);
World Bank, Worldwide Governance Indicators, https://databank.worldbank.org/source/worldwide-governance-indicators
(accessed 15 June 2022); WIPO (2022); Wolf et al. (2022).

534
8. Solutions and Road Map for Promoting a
Circular Economy in Viet Nam
Viet Nam is considered a leader in ASEAN that has a strong legal basis for a transition to a circular
economy. Implementing a circular economy requires a road map and development priorities based
on market and social demands. It is essential that specific goals and targets be defined with feasible
actions/measures.

8.1. National Circular Economy Criteria

Shifting to a circular economy requires the government and stakeholders to make collective efforts.
Referring to international experience, a market-based approach to the transition is best. The
development of policies and regulations on the circular economy in Viet Nam has been in line with
the positive trend of the region and the world.

In compliance with the identification of three groups of common criteria in Decree No. 08/2022/
ND-CP guiding the implementation of Law on Environmental Protection 2020, specific indicators are
proposed to measure the progress of the transition to a circular economy at the macro level in Viet
Nam (Table 17.7).

Table 17.7. Criteria and Indicators for the

Implementation of a Circular Economy in Viet Nam
Criteria Indicator

A Reduce the exploitation and use of non-renewable resources and water resources;
increase efficiency in the use of resources, raw materials, and materials; save energy

Reduce the exploitation and use of non-renewable resources and water resources;
A1 increase efficiency in the use of resources, raw materials, and materials

1 Minerals - Consumption norms of mineral

resources
- Consumption efficiency of mineral
resources

2 Fossil fuels - Consumption norms of fossil fuels

- Consumption efficiency of fossil
fuels

3 Consumption of raw materials, fuel, and - Consumption rate of raw materials,

materials fuel, and materials of some main
production industries

4 Water resources - Consumption norms of water

resources
- Consumption efficiency of water
resources

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 Criteria Indicator

A2

5 Mineral resources use efficiency

6 Water use efficiency Amount of water consumed per unit of GDP

Amount of water consumed per unit of
industrial value added
Amount of water consumed per unit of
output of main industries

A3 Energy savings

7 Energy use Primary energy consumption per GDP

8 Energy savings Primary energy consumption per

average GDP

9 Exploiting and using renewable energy Ratio of renewable energy sources in

total primary energy supply (%)

B Extend the useful life of materials, equipment, products, goods, parts

10 Eco-friendly products Number of eco-friendly products

certified with eco-labels

11 Recovery and recycling of discarded Percentage of discarded products that

products are recovered and recycled

12 Recovery and recycling of material Rate of recycling metal, non-metal,

paper, plastic, rubber, and food waste

13 Water reuse Rate of reused wastewater meeting the

requirements

C Reduce waste generated, and minimise adverse impacts on the environment

C1 Reduce solid waste, wastewater, and emissions

14 Solid waste - Amount of hazardous solid

waste collected, transported, and
handled that meets environmental
protection requirements
- Amount of municipal solid waste
collected, stored, transported, and
handled that meets environmental
protection requirements
- Percentage of municipal solid waste
that goes to landfills

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 Criteria Indicator

- Amount of ordinary industrial

solid waste collected, reused,
recycled, and handled that
meets environmental protection
requirements
- Average per capita municipal waste
generation

15 Wastewater Percentage of wastewater collected and

handled that meets national technical
regulations

16 Emissions Emissions causing air pollution and

spatial distribution of emissions

C2 Reduce the use of toxic chemicals

17 Good management of the life cycle of Number of production and business

chemicals and waste according to signed establishments applying the
international commitments environmental management system
according to ISO 14000 standards

18 Use of inorganic fertilisers, chemical Amount of inorganic fertilisers, chemical

pesticides, and antibiotics in cultivation, plant protection products, and antibiotics
animal husbandry, and aquaculture

C3 Waste recycling, energy recovery, and reducing greenhouse gas emissions

19 Waste recycling, energy recovery - Amount of waste recycled, reused,

and treated combined with energy
recovery
- Amount of waste recycled, reused,
and treated combined with
composting

20 Reduce greenhouse gas emission Intensity of greenhouse gas emissions

per GDP

C4 Reduce single-use products, green shopping

21 Reduce single-use products Amount of single-use plastic products,

non-biodegradable plastic packaging
and products and goods containing
microplastics produced and imported

22 Green shopping Percentage of public investment works

and projects that apply green economic
standards

GDP = gross domestic product.

Source: Article 138 of Decree No. 08/2022/ND-CP guiding details of the implementation of the Law on Environmental
Protection 2020.

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8.2. Specific Solutions for Promoting Implementation
Viet Nam aims to shift from a linear economy towards a circular economy,
targeting sustainable economic development for a more competitive
economy. To realise that goal, a range of solutions are suggested based
on governance, institutions, and infrastructure in Viet Nam.

Institutionalisation of the circular economy. Policy approaches for the

transition to a circular economy may include key categories of policies:
market-based policies, regulatory policies, and information policies.
Regarding the market-based approach, it is important to promote the
institutionalisation of market principles and the polluter-pays principle
so that environmental costs are incorporated into the pricing for
environmental pollution remedies and environmental rehabilitation.
Also, it should use existing economic tools and financial mechanisms to
regulate and to enhance the transition to the circular economy.

The use of regulatory instruments is central to circular economy

policymaking in Viet Nam. Accordingly, it is necessary to enforce
relevant provisions on the circular economy as prescribed in Law on
Environmental Protection 2020, particularly the development of a national
action plan; provincial action plans; and action plans for implementation
of the circular economy in industries, fields, and products; and the
establishment of criteria for assessment of progress on the transition to
a circular economy. Also, ministries, ministerial agencies, and provincial
people’s committees must incorporate a circular economy immediately
when creating a development strategy, plan, programme, or project.

At the same time, the government may take appropriate steps to enforce
other policies supporting the transition to the circular economy, including
green public procurement, green credit, green bonds, environment
industries, and environmental services. Furthermore, it needs to revise
the current environmental protection tax, value-added tax, consumer
protection, and public investment.

The circular economy is a shared responsibility across levels of

government and stakeholders. The government is both a management
entity – creating a legal corridor for the formation and operation of
markets and playing fields for all economic actors participating in
the circular economy – and the entity engaging in market relations. It
is vital for Viet Nam to formulate a national road map and to develop
an inter-sectoral coordinating agency to integrate the relevant goals
and strategies of the implementation of the circular economy into the
strategies and action plans of various sectors and industries.

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Promote material recovery, and minimise non-recyclable waste. In the
circular economy, material recovery is crucial. There are three main ways
to promote material recovery – segregating waste at the source, expanding
producer responsibility, and enhancing the development of new markets
(e.g. recovery and recycling markets of plastic, paper, and metal, and the
market for recycled products). Public procurement has an impact on such
markets since it can direct the production and consumption of recycled
products.

Along with material recovery, the government should consider the

restriction of non-recyclable waste, particularly single-use plastic
products. It is necessary to formulate and implement policies to promote
the development of a circular economy in the field of production and
consumption of plastic products, regulating the recycling responsibilities
of manufacturers and importers of plastic products and plastic packaging.
MNRE could take primary responsibility to develop a circular economy in
line with the net-zero emissions target. It could use modern technologies
to produce plastic products; optimise the use of raw materials and fuel in
the production of plastic products; recycle plastic waste into raw materials
and fuel for industrial and domestic use; support the construction and
formation of the waste-recycling market; and build and update the plastic
management database and integrate it into the national environmental
database.

Apply science and technology, and strengthen international cooperation

in the transition to a circular economy. Institutes, universities, and
professional associations are encouraged to participate in researching,
consulting, and evaluating the implementation of the circular economy. It
is also recommended to implement technological innovations, gradually
applying clean and environmentally friendly technologies and building
a road map to eliminate outdated technologies causing environmental
pollution, especially in the industries that pose a high risk of contamination
like textiles, footwear, paper, and detergents. To promote the formation
of linkage mechanisms based on science and technology, models of eco-
industrial parks, urban ecological areas, and circular cities (green cities)
should be developed.

Research and cooperation in science and technology transfer can be

strengthened to develop appropriate measures and solutions for the
implementation of a circular economy, giving priority to the economic and
efficient use of resources and prolonging the lifespan of materials and
equipment. The cooperation could be enhanced between Viet Nam and
countries that share the common goal of developing a circular economy,
particularly AMSs. Viet Nam could actively take advantage of capacity
building and training, research cooperation, and science and technology
transfer for the implementation of the circular economy.

539
MNRE can cooperate with the Ministry of Science and Technology in
developing and providing technical guidance on the application of
the best available techniques. Also, MNRE can review, update, and
supplement the list of best available techniques in a manner that is
relevant to the current situation and level of science and technology
development, providing technical guidance on the application of the best
available techniques for each type of production, business, or service
causing environmental pollution.

Raising awareness on the circular economy. Transitioning to a circular

economy requires awareness and behavioural changes from all sectors
of society. Positive practices and behaviours need to be promoted, while
negative habits that are built up over many years need to be discouraged
or prohibited. In a circular economy, traditional consumption patterns
need to be replaced by reuse, repair, and exchange models. The
government plays an important role in effective communications in the
drive to implement such behavioural change.

Enterprises, consumers, and their behaviours play a major role in

the transformation process to the circular economy. Production and
consumer awareness and knowledge are important factors determining
responsible consumption and production behaviours. Additionally,
raising awareness is key to accelerate the implementation of circular
economy strategies at the national, regional, and community levels and
to allow stakeholders to provide their feedback on circular economy-
related issues.

Communicating, educating, and raising awareness about policies and

legal regulations on the circular economy target not only governmental
officials at national and local levels but also enterprises and communities.
Accordingly, it is necessary to develop and to implement communication
programmes with appropriate content and forms for each target group
in society. When doing this, it needs to strike a balance between effective
communication and avoiding information overload.

In Viet Nam, the communication and dissemination of knowledge and

laws relating to the circular economy could be carried out regularly and
widely. MNRE could preside over and cooperate with other ministries,
ministerial agencies, socio-political organisations, communication
agencies, and press agencies in communicating and disseminating
knowledge and laws relating to a circular economy to ensure the delivery
of a consistent and continuous national message.

The government could issue a mix of incentivisation and enforcement to

increase good behaviours as well. The benefits of changed behaviours
must be emphasised and encouraged. The requirements and standards

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of labelling in providing information to consumers need to be regulated
so that the products carry a message on their environmental impacts
and how they are dealt with at the end of their lives. At the same time, the
government should continue to consult and to engage with the public,
industries, and other stakeholders when designing new policies and
interventions on the circular economy to ensure their effectiveness.

In the long term, educational programmes can include knowledge of

the circular economy. The government could give priority to human
resources for circular economy development; invest in the training of
officials, managers, and technical personnel in charge of the application
of circular economy; and encourage entities to train human resources for
the circular economy. The Ministry of Education and Training can have
primary responsibility and cooperate with MNRE in providing educational
content and developing human resources for the circular economy.

Develop technical infrastructure and information and data systems.

In Viet Nam, the circular economy transition is centred around the
10R principles as prescribed in Decree No. 08/2022/ND-CP, including
(i) restriction of the use of non-eco-friendly products; (ii) best use
of equipment and products; (iii) increased efficiency in product
manufacturing or use of natural resources, raw materials, and materials;
(iv) reuse by another consumer; (v) repair or maintenance of a product
to prolong life; (vi) refurbishment by restoring an old product; (vii)
remanufacture by using parts of the discarded product in a new product
with the same function; (viii) repurpose by using a discarded product or
its parts in a new product with a different function; (ix) reduction of waste
generated, including recycling waste; and (x) incineration of waste with
energy recovery.

To support circular economy activities, it is crucial to improve existing

infrastructure and to invest in new assets such as recycling facilities,
sharing networks, reverse logistics, and marketplaces. One of the
priorities in Viet Nam is to improve the system of waste collection,
classification, and treatment infrastructures. MNRE could submit to the
Prime Minister for consideration and approval a national master plan on
environmental protection that includes master plans for concentrated
waste treatment zones at the regional and national levels. The Ministry
of Construction could strengthen its management of the technical
infrastructure of waste collection points, transfer stations, and treatment
facilities.

There are many opportunities for Viet Nam to provide infrastructure that
enhances the transition to a circular economy. For example, conventional
infrastructure can be replaced with green, climate-resilient, and
nature-based solutions. The new infrastructure can be more efficiently

541
designed and planned to reduce the demand for materials and environmental impacts. Regarding
infrastructure for waste management, waste collection and sorting infrastructure needs to be in
place to enable the reuse, repair, refurbishment, and recycling of materials.

Digital infrastructure is an emerging solution to enable connectivity and optimisation of the value
chain in the circular economy. Digital platforms can connect resource suppliers with the demand for
secondary materials. Furthermore, building comprehensive and accessible data systems is key to
informing circular economy policymaking, assessing the effectiveness of circular economy policies,
and adjusting them when needed. In Viet Nam, the General Statistics Office of Viet Nam is assigned
to conduct statistical activities and to provide social and economic information domestically and
internationally. It could coordinate with MNRE to undertake data collection, monitoring, and sharing
on the circular economy. MNRE could provide additional data and analytical insights on national
circular economy indicators.

In the long term, a national circular economy information system should be built to centralise the
data required to assess and to fully inform circular economy policymakers. Data collection is not only
limited to waste-related, environmental, economic, and social data but also covers economic–social
dimensions such as value added and employment. More importantly, monitoring the achievements
of the implementation of a circular economy requires a standardised set of indicators feeding into
the national circular economy information system. This emphasises the necessity of issuance of
national circular economy criteria for Viet Nam.

Financing the transition to a circular economy. The transition to a circular economy needs both public
and private investment. The government should allocate a budget to support the implementation of
circular economy policy objectives, plans, and schemes. In particular, priority is given to restructuring
public investment into greener investment. Governments at different levels could mobilise financial
resources and allocate them efficiently, for example, by expanding access to financial opportunities.
The government should develop mechanisms and incentives to encourage and support enterprises
to innovate their manufacturing towards resource efficiency, energy savings, and environmental
protection, particularly enterprises applying cleaner production and circular economy principles. It
also prioritises supporting the production and supply of products and services that meet the criteria
of the circular economy. To promote the consumption of such products and services, it can build up
distribution systems and markets of environmentally friendly products and services.

The government can apply a mix of price-based tools to ensure a coherent set of incentives for the
development of a circular economy, for instance, environment-related taxes, fees, and charges that
increase the cost of polluting activities; and extended producer responsibility policy instruments.

In the transit to circular economy and the context of climate-change adaptation measures, Viet
Nam should prepare for the shift in demand of resources. For example, to reduce greenhouse gas
emissions, it is necessary to reduce the use of energy from fossil fuels and to increase the use of
renewable energy. The effects of primary and secondary markets of resources and materials need
to be considered.

542
At the same time, the government should foster private investment in
developing a circular economy through various funding methods, including
crowdfunding, leasing, equity participation, grants, loan guarantees, green
bonds, and loans for circular economy projects and businesses. It should
attract private investment in public–private partnerships for infrastructure
development for green industries and eco-industrial parks, circular urban
areas, organic agriculture, and environmental services.

To diversify capital sources, the government can also call for financial aid and
foreign investment from other countries. The government should enhance
the ability to attract official development assistance (ODA) and increase the
investment rate for circular economy development from ODA. Localities can
set up specific circular economy development projects in their provinces to
attract ODA capital, supporting projects related to the efficient and economical
use of natural resources and waste reduction.

Develop a road map. The Framework for Circular Economy for the ASEAN
Economic Community sets out an ambitious long-term vision of the circular
economy, building on the strengths of existing ASEAN initiatives, and
identifies priority focus areas for action, along with enablers, to accelerate the
realisation of a circular economy in ASEAN. It guides ASEAN in achieving its
long-term goals of a resilient economy, resource efficiency, and sustainable
and inclusive growth.

To set a pathway for the transition to a circular economy in line with the
region, the government should consider the comprehensive integration of
five strategic priorities in the framework into the relevant national policies,
strategies, and action plans. The integration should focus on possible short-
term, medium-term, and long-term initiatives in priority areas and refer to
the potential funding, institutional coordination, and regulations to support the
transition to the circular economy in Viet Nam. The government should call
for the support of ASEAN in facilitating knowledge sharing, identifying areas
for possible collaboration, and providing policy recommendations to integrate
ASEAN’s visions into the transition to the circular economy in Viet Nam.

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8.3. Road Map for a Circular Economy in Viet Nam
Based on the analysis of the existing orientation, policies, and legal regulations in Viet Nam;
consultation results with organisations and individuals in specific industries and fields; assessment
of opportunities and challenges in application of a circular economy in specific industries and fields;
the authors propose a road map with strategic measures to promote the transition to a circular
economy in Viet Nam (Table 17.8).

Table 17.8. Proposed Plan for Priority Products, Sectors, and Fields
in the Circular Economy Road Map for Viet Nam

Goal
No. Area Strategic
Measure
2025 2030 2045

A Products

Plastic x • Ban the use of single-use plastic products and non-

biodegradable plastic packaging (including non-biodegradable
plastic bags, Styrofoam containers for packaging and
containing food) at shopping malls, supermarkets, hotels, and
tourism areas, except for the products and goods containing
non-biodegradable plastic packaging.
• Gradually reduce the production and import of single-use
plastic products (except for Vietnam Ecolabel certified
products), non-biodegradable plastic packaging and products
and goods containing microplastics.
• Implement the regulations on responsibility for recycling and
treatment of producers and importers of single-use plastic
products and non-biodegradable plastic packaging.
• Assign provincial people’s committees to promulgate
regulations on and to organise management of plastic waste,
and organise inspections at establishments producing single-
use plastic products and non-biodegradable plastic packaging
within their provinces.
• Reuse, recycle, and treat 85% of plastic wastes produced.
• Reduce 50% of plastic waste in oceans compared to prior
period.
• Design circular economy models in Viet Nam with an orientation
towards reducing the use of non-biodegradable disposable
plastic products and plastic bags; increasing the reuse,
recycling, and disposal of plastic waste; and encouraging
reuse-refill models.
• Develop technical regulations for secondary plastic raw
materials.
• Facilitate the development of secondary raw material markets.
• Raise awareness of the production, consumption, and
disposal of non-biodegradable plastic waste, plastic bags,
and single-use plastic products in daily life amongst agencies,
organisations, businesses, communities, and people.

• Design master plans for areas supplying materials for pulp

Paper x production.
• Promote the paper-recycling industry.
• Restructure small and medium-sized enterprises to replace
poor-quality machines with modern and large-scale machines,
technologies, and techniques to efficiently use raw materials,
energy, waste, and chemicals and to reduce waste in paper
production.
• Support enterprises to invest in paper collection and recycling
systems and to harmonise and to promulgate standards for
wastepaper and secondary materials

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 Goal
No. Area Strategic
Measure
2025 2030 2045

• Promote the application of circular business models and the

Batteries model of turning products into services through leasing and
applying extended producer responsibility tenets.
• Expand extended producer responsibility in the retrieval and
recycling of batteries.

Timber x • Efficiently implement the schemes for sustainable forest

management and forest certification.
• Build and efficiently operate a national forest certification
system to promote sustainable forest management and the
issuance of forest certifications.
• Foster cooperation and association models for the development
of large timber forests granted sustainable forest management
certification and associated with forest-product processing and
consumption.
• Encourage and create conditions for mechanisms and policies
for enterprises to effectively use by-products generated in the
production process.
• Implement pilot models of the circular economy in the timber-
processing industry.

Biomass x • Prioritise resources to develop biomass energy sources to

produce electricity, biogas, and biomass pellets for direct use
as fuel and liquid biofuel.
• Apply technologies to promote a circular breeding industry (e.g.
livestock waste treatment for organic fertiliser or aquaculture
production).
• Invest in the development of waste-to-energy plants.
• Design master plans for areas supplying raw materials.
• Issue incentives to support the production and export of wood
pellets, coconut fibre pellets, and pellets from sawdust.
• Promote models to make use of agricultural, forestry, and
fishery by-products, and biomass sources

• Complete mechanisms and policies for e-waste management.

Electronic equipment x • Create supporting conditions for the development of e-waste
recycling.
• Build a synchronous and transparent database system on
e-waste.
• Raise awareness and enhance engagement of the community,
businesses, and society at large in e-waste management.

B Industry

Agriculture x • Develop policies to create a legal corridor for the formation

and development of a circular economy in agriculture and rural
development.
• Conduct research, and implement solutions for increasing
recycling and reusing agricultural by-products and scraps.
• Train and improve personnel for research and implementation
of agricultural by-product and scrap-processing technology,
research investment, and science and engineering transfer in
processing agricultural scraps.
• Develop and implement programmes and projects utilising
the circular economy in developing primary agricultural
value chains to increase competitiveness; create value;
and effectively use land, water, and materials in reducing
environmental degradation and pollution.
• Promote the participation of private sector, nongovernmental
organisations, and agricultural households in circular
agricultural product chains.
• Build models for increasing the effective use of water, land, and
fisheries.
• Develop and implement programmes for green agriculture and
the circular economy in agriculture and rural development.

545
 Goal
No. Area Strategic
Measure
2025 2030 2045

• Promote the implementation of plans for green urban

Construction x development, schemes for urban areas adapting to climate
change, and schemes for the development of smart urban
areas.
• Promote the development of environmentally friendly products
and recycled products from construction waste.
• Develop new environmentally friendly materials for
construction.
• Promulgate technical and regulations for green buildings.
• Develop circular models in the construction industry.

Transport x • Create regulations and policies for developing green traffic

infrastructure; encourage vehicles utilising clean, efficient,
effective energy and environmentally friendly technology; and
encourage green traffic and traffic planning.
• Prioritise resources for investment, completion, and extraction
of green traffic infrastructure in a manner that guarantees
economic effectiveness and environmental protection, reduces
greenhouse gas, and increases resistance to climate change
and rising sea levels.
• Implement programmes for research and the application
of science and technology that guarantees the effective use
of construction materials and energy in implementation of
projects for investment in public traffic infrastructure.
• Adjust economic tools, such as environmental protection taxes
and environmental incentives, to promote the use of low-
carbon and green transport means.
• Encourage the formation of circular business models in the
field of transport such as sharing models, product-to-service
models, and public transport.
• Build a green transport infrastructure system, and promote
intelligent traffic monitoring systems.
• Create favourable conditions for localities and transport
enterprises to access to green credits and green bonds.
• Apply green public procurement in the field of transport.

• Develop circular economy models to promote effective and

Energy x efficient energy use.
• Develop policies for energy transition in a manner that
guarantees green, clean, sustainable energy.
• Increase percentages of renewable energy and energy from
waste, and reduce dependency on imported energy and fossil
fuels.
• Increase technological solutions for ensuring harmonious
development of new energy and renewable energy, increase
integration of renewable energy into the electrical grid, and
reduce energy consumption.
• Develop supporting infrastructure for renewable energy.

• Make full use of the value of wastewater generated from

Water and wastewater x production, business operations, service provision, and
domestic activities by adopting measures in the following order
of priority: (i) treat and reuse wastewater directly in production,
business operation and service provision as prescribed by
law, (ii) treat and transfer wastewater to reuse wastewater
in production, business operations, and other services as
prescribed by law, (iii) transfer wastewater to another unit
for treatment and reuse as prescribed by law, and (iv) treat
and discharge wastewater in accordance with environmental
technical regulations.

• Formulate and promulgate technical regulations on the

environment in chemical industry to ensure sustainable
Chemicals x development and environmental protection.
• Refuse applications for investment licenses for chemical
projects that apply obsolete technologies and have high levels
of resource consumption.
• Encourage and adopt incentives and support mechanisms/
policies for chemical projects that apply advanced, modern,
and eco-friendly technologies.
• Ensure that hazardous or toxic chemicals are not found in
recycled products.
• Promote chemical recycling (e.g. using chemicals in waste
conversion and treatment).

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 Goal
No. Area Strategic
Measure
2025 2030 2045

Waste management x • Enhance the management of discarded products and solid

waste to minimise the exploitation and use of natural resources
and adverse impacts on the environment according to the
circular economy criteria specified in laws.
• Minimise waste generated by applying measures to improve
efficiency in production or in using products.
• Make full use of the value of discarded products and solid
waste generated from production, business operations,
service provision, and consumption by adopting measures in
the following order of priority: (i) recycle discarded products;
(ii) repair, maintain, or upgrade defective and old products to
extend their useful life; (iii) make use of parts of discarded
products; (iv) recycle solid waste to recover raw materials,
fuel, and materials in service of manufacturing activities as
prescribed by law; (v) treat solid waste in combination with
recovering energy as prescribed by law; and (vi) bury solid
waste as prescribed by law.
• Apply digital transformation, and develop and apply platform-
based business models to promote the minimisation, reuse,
classification, collection, transport, recycling, and treatment of
waste generated.

• Prioritise the development of eco-design services and design

Services x for circulation and reuse; and encourage the development of the
environmental service industry, environmental industry, and
opening of markets and facilitation of trade in environmental
goods.
• Develop policies related to warranties, insurance, and
consumers' rights on repair and refurbishment.
• Develop eco-design services.
• Promote trade liberalisation for environmental services
according to a road map consistent with international
commitments.
• Encourage investment in, research, and provide environmental
services towards (i) collection, transport, recycling, and
treatment of waste; (ii) environmental monitoring, analysis,
and environmental impact assessments; (iii) improvement
and remediation of the environment and ecosystems in
polluted and degraded areas; (iv) consulting and transfer
of environmentally friendly production technologies,
energy-saving technologies, and production of clean and
renewable energy; (v) environmental consulting and training,
and provision of information about the environment; (vi)
clean energy, renewable energy, and energy savings; (vii)
environmental assessment for goods, machinery, equipment,
and technologies; (viii) environmental and biodiversity damage
assessments and assessments of pollutants that directly affect
human health; and (ix) other environmental protection services
as needed.

• Identify the potential types of technology, equipment, and

Environmental industry x products to support the circular economy transition.
• Establish an effective coordination mechanism across
ministries and agencies to implement environmental industry-
related policies.
• Implement a system for maintaining the relevance of
environmental industry-related policies and monitoring their
implementation.
• Increase the proportion of domestically supplied environmental
technology, equipment, and products for the local market.
• Improve linkages with local manufacturers in the environmental
sector.
• Promote the export of environmental technology, equipment,
and products.
• Improve the capacity of local enterprises, their support
environments, and their access to finance (with a focus on
small and medium-sized enterprises).
• Establish a road map for trade openness and trade facilitation
for the environmental industry to support the green transition.

547
 Goal
No. Area Strategic
Measure
2025 2030 2045

C Locations

Industrial parks, x • Encourage industrial parks to design optimal overall premises;

promote linkages amongst production, business, and service
industrial clusters establishments to improve the efficiency of use and to reduce
the consumption of land, water, mineral, and energy resources;
and improve the recycling rate and reduce the total amount of
waste generated.
• Develop and use clean energy and renewable energy bylaws.
• Develop infrastructure for the collection and storage of
rainwater and infrastructure for the collection, treatment, and
reuse of wastewater.
• Promulgate technical regulations to implement industrial
symbiotic networks and the reuse of waste and wastewater.
• Issue financial incentives for eco-industrial parks and eco-
enterprises (e.g. tax exemptions and reductions).
• Apply industrial symbiosis measures in accordance with the
law on the management of industrial parks and economic
zones.

• Build a platform to share information and data on application of

Urban areas, the circular economy in cities.
• • Enhance the development of zero-waste and smart
residential areas cities.
• Integrate the criteria of circular cities into master plans on
urban development.
• Design and build urban infrastructure, applying new and
breakthrough technologies to develop smart and circular urban
areas.
• Promote urban waste management through the application
of management measures to promote reuse and recycling of
solid waste, particularly metal and plastic waste, e-waste, food
waste, wastewater, and biomass.
• Promote the development of circular business models in urban
areas through solutions to support the development of raw
material and secondary material markets, creating favourable
conditions for symbiotic production, business and service
activities, and urban–rural linkages.

D Consumption

Intermediate x • Develop standards on secondary raw materials.

• Support the informal sector, and promote linkages between
consumption businesses and the informal sector.
• Develop a road map to open and to facilitate trade for goods and
services related to the circular economy.
• Develop markets for the reuse of discarded products and waste
recycling.

Public consumption x • Complete a legal framework on green public procurement.

• Apply pilot green public procurement to central procurement
agencies.
• Promote green shopping and eco-labelling programmes.

• Strengthen communication and education to raise awareness

Household consumption x and to change behaviours on sustainable consumption.
• Create preferential policies for enterprises producing
environmentally friendly products to encourage and to expand
the scale of production and business of environmentally
friendly products.

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 Goal
No. Area Strategic
Measure
2025 2030 2045

E Strengthening the x • Promote productivity, technology, and innovation through

measures to enhance micro, small, and medium-sized
role of micro, small, enterprise productivity by understanding key trends in
and medium-sized productivity.
• Promote innovation and disruptive technologies as a key
enterprises competitive advantage through technology use and application
to business and business academia linkages.

Linkage models x • Develop linkage models, and share models in use of materials
and waste.
in production and • Encourage the establishment of cooperative groups,
business towards cooperatives, unions of cooperatives, recycling alliances,
regional linkage models, urban–rural linkages, and other
circular economy models as prescribed by law that satisfy circular economy
criteria.

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